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Credit Suisse-Ecuador Deal for Galapagos Conservation

Facts for Prelims (FFP)

 

Source: IE

 Context: Credit Suisse has announced buying Ecuadorian bonds worth $1.6 billion (€1.45 billion) in a debt-for-nature swap that cost the Swiss bank just $644 million.

 Purpose: Ecuador has committed to spending (for 20 years) on the protection of one of the world’s most precious ecosystems – The Galapagos Islands.

  

The Galapagos Islands:

  • The remote islands – home to some of the most unspoiled nature in the world – are a UNESCO world nature heritage site.
  • Their animal life was crucial to Charles Darwin’s research before publishing his theory of evolution.

 

Significance of the deal:

  • The buyer (Credit Suisse) has recently been taken over by Swiss banking giant UBS in a bid to calm the financial markets amid a banking crisis.
  • The seller (Ecuador) has been mired in a political crisis as the country’s National Assembly seeks to impeach President (Guillermo Lasso) for alleged embezzlement.