A Closer Look at the TNC, the Blue Bond and the Belize Maya Forest
Tonight, we take a closer look at The Nature Conservancy’s work in Belize, differentiating between the organization’s involvement in protecting over two hundred thousand acres of forest land in the Belize Maya Forest, and agreeing to aid Belize in restructuring its super bond with marine conservation as its end goal. News Five’s Paul Lopez seeks to demystify TNC’s Blue Bond, what it means for the country’s debts and oceans, and bondholders. Here is that report.
Elma Kay, Managing Director, Belize Maya Forest Trust
“We are a local N.G.O., we have N.G.O. Status. Our role is really to be the trustee or the custodian of the two hundred and thirty six thousand acres that were bought by The Nature Conservancy to put in trust for the people and government of Belize.”
Paul Lopez, Reporting
The area known as the Belize Maya Forest is home to over two hundred species of trees, some four hundred species of birds, various species of monkeys and wildcats, in North-Western Belize. The Belize Maya Forest is engaging nine community stakeholders to participate in developing a management plan.
Elma Kay
“So for example, in terms of our southern borders, we have communities like Yalbac Village, La Gracia, Buena Vista, Spanish Lookout, and on the Northern side, because the Belize Maya Forest is a key area that recharges the Rio Hondo, we also choose some of our beneficiary communities which are Blue Creek and San Felipe to be part of the process.”
Elma Kay
The Nature Conservancy purchased these lands using their own financing and the funds of partners they brought on board. The Government of Belize has signed an agreement with the TNC for the Belize Maya Forest. The agreement includes discounts on land taxes and duties and the rights to carbon credits.
Elma Kay
“This process was a process of negotiation, originally with the previous government. They were willing to concede the full land tax waiver, and with this government we had to renegotiate for a discounted rate, rather than a full tax waiver. The other portion of that agreement deals with the carbon rights. Basically in that agreement, it is stated that the government is granting those carbon rights to the Belize Maya Forest Trust, to be able to repay some of the accusation cost and to create, if you want to call it, well, it is an endowment, but it is a fund that can be used for long term management.”
Legislation to this end was passed in the National Assembly on Friday. Now, TNC’s acquisition of the two hundred and thirty-six acres of land and the establishment of the Belize Maya Forest Trust is not to be confused with the funding expected to be provided to the Government of Belize under the Conservancy’s Blue Bond for Ocean Conservation program. This is a second undertaking meant to restructure the government’s so-called five hundred and fifty million dollars Super bond.
Elma Kay
“Very different, so I want to make that distinction because I have seen in the news there has been some confusion and I think it’s because the Nature Conservancy is involved in both agreements or initiative.”
Prime Minister John Briceño
“TNC, it’s through their efforts, with Credit Suisse, we are working on the financing of this deal.”
So, what is a Blue Bond and how does it work? In short, the Nature Conservancy agrees to buy over a country’s sovereign debt. That country, in turn, must agree to protect at least thirty percent of its marine areas. Blue Bonds are hailed as, “an audacious plan to save the world’s oceans.”
John Briceño
Prime Minister John Briceño
“It’s going to be more marine conservation and it is going to be beyond the reef into our exclusive economic zone.”
In the case of Belize, G.O.B. would pay fifty cents on the dollar to bondholders through funding from TNC, which translates into forty-five percent in savings on the super bond. G.O.B. would then repay TNC, the new bondholders, the Blue Bondholders, at a lower interest rate and over a longer payment period. But, in order to finalize such an offer, the government needs seventy-five percent buy-in from the bondholders.
Prime Minister John Briceño
“We hope and expect that we can reach the seventy-five percent threshold, so that then by doing that we could get rid of the entire super bond and come up with what we call a new, the Blue Bonds, that will be moving it form that, once we do the financing and thing. But, I just want to reiterate, this is the best deal we can offer to the bondholders. It is a very long process, but we are excited about the prospects of finally putting an end to this super bond saga.”
If the government is to end the saga of the super bond, it must reach the seventy-five percent buy-in trash hold by November nineteenth, which ironically is celebrated as settlement day in Belize.
Elma Kay
“I can tell you as a person involved in conservation that it is a great win for Belize because it is a great benefit for Belizeans to know that we can be relieved of this burden of the super bond, or at least portions of it. And on top of that, it is going to be an added benefit, in that the marine ecosystem and the ocean, in those blow bonds if it can all be pulled off. For the average people, it means that it is less money that your children, and your grandchildren, and your great-grandchildren and the children of your great-grandchildren have to pay towards debt.”
Reporting For News Five, I am Paul Lopez.
Savings from the bond restructuring are placed in an endowment fund used to finance works within the nation’s blue economy.
