Clifford Chance

Clifford Chance advises Bank of America on Ecuadorian Debt Conversion to Support Terrestrial and Freshwater Conservation in the Amazon

Global law firm Clifford Chance has advised Bank of America on a US$1 billion debt conversion transaction for the Republic of Ecuador, focused on terrestrial conservation in the Amazon basin. This is one of the largest sovereign debt conversion transactions of its kind executed to-date, generating over US$800 million in net fiscal savings for Ecuador by 2035, and unlocking an expected US$400 million in new cash funding plus an estimated US$60 million in endowment returns to facilitate the Republic of Ecuador’s Amazon Biocorridor Program over the life of the financing.

The transaction involved the refinancing of approximately US$1.53 billion of Ecuador’s international bonds. The U.S. International Development Finance Corporation (DFC) provided political risk insurance and the Inter-American Development Bank (IDB) provided a guarantee. The Nature Conservancy (TNC) will be serving as conservation project coordinator and facilitated the transaction through its Nature Bonds Program. The conservation funding will be channelled into a new independent conservation trust fund created specifically to administer resources towards financing conservation activities in the Ecuadorian Amazon region.

The Amazon Biocorridor Program was established to support conservation and sustainable development in the Ecuadorian Amazon, aiming to improve the management of 4.6 million hectares of existing protected areas and protect an additional 1.8 million hectares of forests and wetlands. The initiative includes a robust framework of social and environmental safeguards designed to protect cultural diversity and support the well-being of local communities.

The successful execution of the deal adds to Clifford Chance's track record advising clients on debt for nature swaps, having advised on similar transactions for The Seychelles (2016), Barbados (2022 and 2024), El Salvador (2024) and The Bahamas (2024). Clifford Chance also advised on a previous debt-for-nature swap for Ecuador in 2023, focussed on the Galápagos Islands.

The Clifford Chance team was led by partner Deborah Zandstra, together with a core team of partner Jon Zonis, senior associates Azam Taiyeb and Lucia Ferrer, associates Alexandra Machado and Jorge Vázquez, and trainee solicitors Susan Nelson and Katie Davies. The wider cross border and cross practice team included Jose Garcia Cueto, Marie Berard, Sophie Wilkinson, James Kelton, Andres Berry and Young Kim, among others.