What is a Debt-For-Nature Swap?
Debt-for-nature swaps are an agreement between the U.S. government and the government of a developing country: The United States forgives a portion of the countrys debt. The money that would have gone to pay the debt is then used to conserve tropical forests. The U.S. Congress passed the Tropical Forest Conservation Act in 1998, which established legislation that created current debt-for-nature swaps. To participate in this program, a developing country should have a stable political and economic system. Private and non-governmental organizations then must commit to providing a certain amount of funds to purchase the developing countrys debt from the U.S. Treasury.
