Debt-for-nature swaps are a potentially powerful financial tool to address some of the most pressing challenges facing developing countries. However, their use must be carefully evaluated.
Ecuador has signed a landmark debt-for-nature swap deal to raise funds to protect the Galápagos Islands. The financial instrument has been around since the 1980s, with 140 such transactions completed to date. But what exactly are debt-for-nature and debt-for-climate swaps, and do they go far enough to help countries reduce debt and take climate action?
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