Western Hemisphere
Western Hemisphere
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Challenge

The Galápagos Islands represent a core piece of Ecuador’s economy, accounting for more than a third of its tourism revenue.

Yet Ecuador’s high levels of sovereign debt have limited its resources to preserve these natural habitats. 

Solution and Impact

In May 2023, DFC provided more than $656 million in political risk insurance (PRI) that enabled Ecuador to exchange $1.6 billion of its international bonds for a $656 million loan financed with the issuance of a Galápagos Marine Bond.

The transaction is expected to generate more than $450 million for investment in the Galápagos Islands and more than $1.1 billion in lifetime savings for Ecuador through reduced debt service costs.

DFC is one of the few organizations that provides PRI, an important tool for building investor confidence and mobilizing private capital—a core tenet of DFC’s mission—in markets where it’s needed most. Coverage can be as much as $1 billion against losses due to currency inconvertibility, government interference, and political violence including terrorism. DFC also offers reinsurance to increase underwriting capacity.