As part of a debt conversion agreement backed by the United States, El Salvador has launched a major program aimed at restoring the Lempa River basin. The initiative seeks to improve 75,000 hectares of agricultural land through regenerative farming techniques and sustainable livestock practices. The program will be executed by Catholic Relief Services (CRS) and the Environmental Investment Fund of El Salvador (Fiaes), in line with a $1 billion loan agreement with JP Morgan. The funds are designated to repurchase $1.03 billion in bonds maturing between 2027 and 2052.
The development is also supported by the Latin American and Caribbean Development Bank (CAF) and the U.S. International Development Finance Corporation (DFC), which provided a guarantee for the loan.
Katherine Vásquez, Deputy Director of the Lempa River Conservation and Restoration Program, emphasized that the goal is not to change land use but to improve soil conditions through regenerative agriculture. The initiative will target existing farmland used for staple crops and livestock grazing.
“This project will incorporate restoration techniques for both agriculture and sustainable livestock farming, focusing on enhancing the soil’s ability to retain water,” Vásquez said.
CRS Agriculture Program Director, Jaime Tobar, highlighted the implementation of practices such as soil fertility management, agroforestry, and silvopastoral systems. “Healthy soils are the foundation of revitalized agricultural and forest production,” Tobar added.
The $200 million program will span 20 years, with an additional $150 million set aside to ensure continuity through a trust fund. The Salvadoran government will provide annual financing of $9.7 million for the initial phase and $7 million for the second.
Fiaes Executive Director, Jorge Oviedo, noted the program’s focus on improving water quality in the Lempa River, stating, “If we do nothing, the river will continue to deteriorate. This initiative aims to bring new life to the Lempa.” The project will also expand forest cover by 15,000 hectares, restore 5,000 hectares of degraded land, and catalyze investments in water management infrastructure.