Friday, January 04, 2008

"Debt-for-nature" swaps in Costa Rica and around the world

If you've followed any news coming out of Costa Rica, one recent story is how the U.S. canceled $26 million in debt to Costa Rica, with the agreement that those monies would now go toward nature conservation instead of to paying off the debt. This recent podcast from BBC explains the pros and cons of the "debt-for-nature" swap that the US and other European nations are starting to employ, to protect natural resources and discourage misuse of the land.

According to this podcast:
  • 60% of the biodiversity in the world is located in 20 sites. Costa Rica is second most important one.
  • The swap with Costa Rica was the largest one so far
  • Since countries usually focus their resources on more pressing issues, canceling the debt allows them to put the extra money toward environmental conservation without taking money from their current budget
  • Some of the farmers are concerned that their lands are being taken for conservation, and they don't receive any compensation. They fear the money and benefits won't reach them, they'll remain at the top level and not be distributed properly
  • Some worry that this agreement increases U.S. influence over Costa Rica's most precious natural resource - its land. Also, some of the major financial backers of these policies are large corporations with a poor history of environmental preservation in their operations

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