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  • Kills two birds with one stone.

    A major reason why less industrialised developing countries damage the environment is the poverty cycle. The ones relevant to debt-for-nature swaps generally have resource-based economies. The government faces huge debts, has to develop industries like logging, cattle ranching (in Brazil), plantations (everywhere but especially Southeast Asia), etc., to earn enough to pay debts, but thanks to interest, the debts are pretty much unpayable. There is no money left to develop other sectors, alleviate poverty or construct infrastructure, let alone protect the environment. Debt-for-nature swaps can get them out of the poverty cycle on the one hand, and provide capital for the protection of nature on the other. Cameroon has been a pretty successful example so far.

  • No, but I am no expert

    Poverty is a big cause of environmental destruction so the conditions might do more good being about reducing poverty rather than direct environmental protection.

    The number of swaps are in the single digits in some years so they don't seem to be that popular. They have not raised that much in the last 20 years {estimate around 1 billion globally not enough to pay for the big environmental projects needed}.

    They can get traded on the market and the roller coaster that is the market can mean conservation groups can't afford to buy the debts and invest the return into environmental projects.

    The amount of debt forgiven tends to be relatively small and if they are not serving or going to serve the debt anyway it is not really freeing up money for the environment. Something the economist Geoffrey Sachs pointed out when it came to forgiving debts for poor countries.


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