NASSAU, Bahamas - The Bahamian government has welcomed the launch of a new debt conversion project that will save the country an estimated US$124 million over the next 15 years and enable it to improve ocean conservation and management of the Bahamas Protected Areas System.
“The Bahamas Debt Conversion Project for Marine Conservation is more than a financial transaction; it is a declaration of intent, a testament to what can be achieved when creativity meets determination,” said Prime Minister Phillip Davis..
The project, supported by the Inter-American Development Bank (IDB), The Nature Conservancy (TNC)’s Nature Bonds Programme, and other partners allowed the government to buy back US$300 million in external debt with proceeds from a new US$300 million loan arranged by Standard Chartered Bank.
An endowment, expected to grow to US$20 million by 2039, will continue funding marine conservation in The Bahamas beyond the debt conversion project’s 15-year term.
The new financing benefits from a comprehensive guaranteed package of US$200 million credit guarantee from the IDB, alongside a US$70 million co-guarantee from Builders Vision and US$30 million credit insurance from AXA XL.
The Bahamas Protected Areas Fund (BPAF) will manage the conservation funding generated by the deal. Rothschild & Co advised the Bahamas government.
Prime Minister Davis said that over the last two decades, the costs of the country’s vulnerability have been staggering and that from 2002 to 2022, climate-related disasters inflicted over US$6.7 billion in damages, a sum greater than half of the gross domestic product (GDP) of The Bahamas in 2015.
“This is a tale of numbers, but it is also a tale of survival. For every dollar lost, a story unfolds: a family displaced, a fisherman’s boat destroyed, a child’s school reduced to ruins. The pandemic compounded these trials, robbing us of an additional $9.5 billion between 2020 and 2023, losses so severe they rival the total economic output of our nation for an entire fiscal year.
“How long can we stand on this cliff, absorbing the blows of nature’s wrath? How long can we pay the price for a crisis not of our making? The toll is unsustainable—economically, socially, and morally,” he said, adding that the challenges facing the country are vas.
He said that the new initiative is part of a bold new course that reimagines how countries like The Bahamas can finance resilience and conservation.
He said the project allows The Bahamas to refinance US$300 million in external debt, generating an estimated US$124 million in savings over 15 years.
“These savings are not abstract figures; they represent real investments in the future of our people and our planet. They will fund critical conservation efforts, strengthen the management of our marine protected areas, and safeguard the ecosystems that sustain us all.
“And we are thinking beyond the immediate. A US$20 million endowment, set to grow by 2039, ensures that this work will continue long after the debt conversion project concludes.
It is a commitment not just to today’s Bahamas, but to future generations who will inherit this nation and the responsibility to care for it,’ Davis said.
He said the initiative also brings to bear a comprehensive financial framework, leveraging guarantees from the IDB, Builders Vision, and AXA XL to secure favourable terms.
“It demonstrates that even a small nation can command the attention and partnership of the world’s most respected institutions when the vision is bold and the purpose is clear.
“Through this innovation, we are rewriting the rules of engagement for climate resilience and conservation. The Bahamas is showing the world that we are not passive spectators to the forces of nature, we are active stewards of our destiny.”
He said the government views this not just as financial mechanism; but as a lifeline, a strategy, and a promise fulfilled.
“The significance of this moment extends far beyond financial innovation or international acclaim. This announcement is not about abstract policies or distant goals, it is about what this means for Bahamians today and in the years to come.
“At its heart, this initiative is about securing a future where Bahamians thrive in harmony with the environment that sustains us.”
Prime Minister Davis said that the US$124 million in savings the project generates will fund efforts to protect the oceans, “which are not merely geographic features but the lifeblood of our communities.
“From coral reefs that shelter marine life to mangroves that shield our shores, these ecosystems are the unseen engines of our economy and guardians of our homes.
“For the fishermen who rise before dawn, this project means sustainable waters teeming with life. For families living along our coasts, it means protection from storm surges and rising seas.
For our children, it means a chance to inherit a Bahamas where natural beauty is preserved, and economic opportunities abound.”
He said the establishment of a US$20 million endowment ensures that these efforts will endure beyond the project’s term, offering long-term stability for marine conservation and management.
“This initiative also reflects a broader commitment to strengthening our nation. Through improved debt management and institutional frameworks, The Bahamas positions itself as a leader in resilience and sustainability.
“These efforts are not only about protecting nature but about creating jobs, supporting local communities, and ensuring that our economy can weather future storms, both literal and metaphorical.
“Above all, this project is a statement of our values. It affirms that Bahamians will not stand idly by as the challenges of climate change threaten our way of life. Instead, we will lead with vision, act with purpose, and ensure that every step we take today lays the foundation for a brighter tomorrow,” Prime Minister Davis added.
