Abstract
The Nature Conservancy, the world’s largest environmental NGO, has launched an audacious plan to negotiate debt-for-ocean swaps in Southern coastal and small island states, linked to the international pledge of 30 × 30. Representing an evolution from the debt-for-nature swaps popularized in the 1990s, these new variants are regularly praised as ingenious solutions to the debt and biodiversity crisis. Gabon is the latest country to have concluded a swap, bringing the total value of debt exchanged to over US$2.5 billion. However, there are several concerns about these opaque transactions from the perspective of debt justice and the democratic and equitable governance of marine resources. Debt-for-ocean swaps illustrate the pace at which financialization has transformed international approaches to conservation and the risks that this brings.
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Notes
See for example the statement denouncing debt swaps by the Climate Action Network: https://climatenetwork.org/wp-content/uploads/2023/06/CAN-position-on-Debt-Swaps_May-2023.pdf.
This was initially set out under the Enterprise for the America’s initiative, and then later under the Tropical Forest Conservation Act.
For more on the financialization of TNC Standing (2021).
A good example comes in the discussion between panellists on TNC’s debt swaps held at Blomberg’s Green Summit in 2023, https://www.youtube.com/watch?v=6IlSBtiK71o.
Economic Commission for Latin America and the Caribbean (ECLAC), Public debt and development distress in Latin America and the Caribbean (LC/TS.2023/20), Santiago, 2023: https://repositorio.cepal.org/server/api/core/bitstreams/d84a5041-0a2c-4b8e-9b01-d91b187477ce/content.
“Ecuador reaches deal with China to restructure debt”, Reuters, 20 September 2022, https://www.reuters.com/world/americas/ecuador-reaches-deal-with-china-restructure-debt-2022-09-20/.
Lough, R. ‘Seychelles launches defaulted bond exchange offer’, Reuters, 15.t December, 2009, https://www.reuters.com/article/seychelles-eurobond-idAFLDE5BE16120091215.
White, N. ‘Wall Street’s new ESG money maker promises conservation-with a catch’, Bloomberg News, 12 January, 2023: https://www.bloomberg.com/news/articles/2023-01-12/bankers-bet-millions-on-sovereign-debt-deals-tied-to-green-goals.
The terms of this loan can be found in TNC’s financial statement for 2022, https://www.nature.org/content/dam/tnc/nature/en/documents/TNC-Financial-Statements-FY22.pdf. The author has also received a breakdown of interest rate and principal payments due from Belize to TNC by an anonymous source in the Belize government.
This is explained in a webinar presentation provided by TNC, https://www.youtube.com/watch?v=vkp7gAgR4X0.
’Belize shows the growing potential of debt-for-nature swaps’, The Economist, 13 November, 2021, available at: https://www.economist.com/finance-and-economics/2021/11/13/belize-shows-the-growing-potential-of-debt-for-nature-swaps.
’Revealed: 97% of UK marine protected areas subject to bottom trawling’, The Guardian, 9 October, 2020, https://www.theguardian.com/environment/2020/oct/09/revealed-97-of-uk-offshore-marine-parks-subject-to-destructive-fishing.
For a discussion on the the marginalization of small-scale fisheries in marine spatial planning and blue growth strategies Cohen et al. (2019).
See the statement by the Rainforest Foundation: ‘30 × 03: The good, the bad, and what needs to happen next’, https://www.rainforestfoundationuk.org/wp-content/uploads/2023/01/30x30_The-Good-the-Bad-and-What-needs-to-happen-next_EN.pdf.
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Standing, A. The Financialization of Marine Conservation: The Case of Debt-for-Ocean Swaps. Development 66, 46–57 (2023). https://doi.org/10.1057/s41301-023-00379-y
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DOI: https://doi.org/10.1057/s41301-023-00379-y