Spain-El Salvador Debt Swap Agreement for Education
In 2005, the Government of Spain initiated a debt-for-education swap program with El Salvador, canceling US$10 million of debt. This innovative financing mechanism aimed to relieve El Salvadors debt burden while simultaneously investing in its education sector. The funds were redirected towards building rural schools, developing school libraries, and purchasing textbooks. By the programs conclusion in October 2013, significant achievements were made: 31 educational centers were constructed or expanded, 90 schools received new furniture, 1,497 teachers underwent training, and 770 educational centers were equipped with childrens libraries. This initiative demonstrated how debt swaps could be effectively utilized to channel resources into critical education infrastructure and capacity building, benefiting over 174,000 people in El Salvador.
Pros
Alleviated El Salvadors debt burden while simultaneously investing in education
Enabled significant infrastructure improvements in rural areas
Provided resources for teacher training and educational materials
Benefited a large number of students and educational institutions
Cons
Potential dependency on external debt relief for education funding
Possible challenges in the long-term sustainability of the initiatives after program completion
Partners
Government of Spain
Government of El Salvador