Hunton Andrews Kurth Advises DFC on $610 Million in Political Risk Insurance for Innovative Debt Conversion in Support of Marine Conservation in Belize

Hunton Andrews Kurth LLP advised the U.S. International Development Finance Corporation (DFC) in connection with a $364 million Blue Bond transaction with The Nature Conservancy (TNC), the Government of Belize, and Credit Suisse that provides Belize with sovereign debt relief and simultaneously provides significant funding for ocean conservation projects.

Made possible through $610 million in political risk insurance provided by DFC, the deal allows Belize to repurchase $553 million of its sovereign debt at a discount. Through a combination of debt cancellation and debt repayment by the Government of Belize over time, the project will generate approximately $180 million for marine protection and management, coral reef and mangrove restoration, economic diversification, sustainable tourism and fisheries, and will promote the growth of the country’s blue economy. As part of the agreement, Belize agreed to double the percentage of its ocean attributed to Biodiversity Protection Zones, up from 15.9 percent to 30 percent.

“It was truly an honor to be involved in this groundbreaking transaction, which represents the world’s largest debt restructuring for marine conservation to-date. Congratulations to all of the public servants at DFC and other champions of the public interest that made this innovative debt conversion possible,” said Washington D.C.-based energy and infrastructure partner Jamie Head, who has led the Hunton Andrews Kurth team advising DFC for the past 14 months. 

In addition to Head, the Hunton Andrews Kurth team included counsel Patrick McDermott, partner Jay Range, partner Eric Markus and counsel Kevin Gaunt.

Hunton Andrews Kurth has experience across the entire range of arrangements for political risk insurance. The firm has represented project lenders, investors, developers, sponsors and governments throughout Africa, Asia, Latin America and the United States on political risk insurance and other project matters for more than 20 years. The firm also has worked extensively with governments and their parastatals, using financing and other programs provided by the World Bank and other governmental, multinational, multilateral and bilateral export credit, risk insurance and lending agencies.