The governments of the United States and the Republic of Peru announced an agreement to reduce Peru's debt payments in exchange for protecting the country's tropical forests. Under the agreement, more than $25 million will be put towards conserving Peru's tropical forests.

This agreement with Peru was made possible by the Tropical Forest Conservation Act, or TFCA, of 1998. It will complement an existing TFCA debt-for-nature program in Peru dating from 2002, a 1997 debt swap under the Enterprise for the Americas Initiative, and the United States-Peru Trade Promotion Agreement, which includes a number of forest protection provisions. With this agreement, Peru will be the largest beneficiary under the Tropical Forest Conservation Act, with more than $35 million generated for the conservation.

Peru is one of the most biologically rich countries on earth. Funds generated by the debt-for-nature program will help Peru protect tropical rainforests of the southwestern Amazon Basin and dry forests of the central Andes. These areas are home to dense concentrations of endemic birds such as the Andean Condor and Andean Parakeet. 

Primates of the region include the Peruvian Yellow-tailed Wooly Monkey and Howler Monkey. Other mammals such as the Jaguar, Amazonian Manatee, Giant Otter, Spectacled Bear and the Amazon Rive Dolphin also inhabit Peru, as do many unique plants. Rivers supplying water to downstream settlements originate in many of these forests, and people living in and around the forests depend on them for their livelihood and survival.

The new Peru agreement marks the 14th Tropical Forest Conservation Act pact, following agreements with Bangladesh, Belize, Botswana, Colombia, Costa Rica, El Salvador, Guatemala, Jamaica, Panama, which has 2 such agreements, and the Philippines. It is also the second such agreement between the United States and Peru. These debt-for-nature programs will together generate more than $188 million to protect tropical forests.

The United States is pleased to assist Peru in preserving its irreplaceable tropical forests. U.S. Secretary of Treasury Henry Paulson welcomed the agreement, saying "This agreement will build on the success of previous U.S. government debt swaps with Peru and will further the cause of environmental conservation in a country with one of the highest levels of biodiversity on the planet." Such debt-for-nature agreements, he said, "are a successful model of government and citizen cooperation to improve and expand conservation efforts."