Debt-for-nature swaps are financial agreements in which creditors, such as international conservation organizations, banks, or governments, can reduce, restructure, or purchase a portion of a developing country’s debt at a discount in exchange for commitments to invest in local environmental conservation and climate-resilient solutions [1].
The savings generated from these swaps are typically redirected toward projects such as ecosystem restoration, biodiversity protection, or sustainable land use. Countries that have entered into such agreements include Bolivia, Costa Rica, the Philippines, Belize, Barbados, and the Seychelles, according to the World Economic Forum [2]. In recent years, over $6 billion in transactions have been completed, with the most notable being a $1.5 billion deal with Ecuador aimed at protecting the Galápagos Islands and other critical ecosystems.
In July, during the decennial UN Finance for Development summit, Spain and the World Bank announced the launch of the Global Hub for Debt Swaps for Development. This program is designed to provide financial and technical assistance to countries seeking to implement these mechanisms.
Debt-for-nature swaps are often described as mutually beneficial: they offer debt relief for governments while funding environmental initiatives [3]. However, opinions remain divided. Rania Al-Mashat, Egypt’s Minister of International Cooperation, told the World Economic Forum that the monetary amount of many swaps may not be sufficient to drive a full transition. It is argued that while these deals are symbolically powerful, they are often too small in scale to meaningfully reduce sovereign debt or deliver measurable conservation outcomes. As Carbon Brief notes, some experts question whether these swaps have delivered tangible environmental benefits, citing a lack of evidence and concerns about governance, scale, and long-term impact.
If there is skepticism around the true impact of debt-for-nature swaps, what would it take to make them more than symbolic?
The answer lies in how the funds are planned and deployed. For these mechanisms to deliver long-lasting results, they must support innovative, cost-effective, and scalable nature-based solutions that address both environmental and economic challenges. This requires not only financial restructuring but also a commitment to supporting technologies and companies that are redefining sustainable development.
ECOR Global, for example, transforms agricultural waste fibers and recycled post-production materials into high-performance, non-toxic building materials. This circular approach demonstrates how sustainability can be both environmentally regenerative and cost-competitive. As ECOR’s inputs are low-cost and locally sourced, the technology is especially viable for governments seeking to meet conservation goals while stimulating local economies and reducing reliance on extractive industries.
To fully realize the potential of debt-for-nature swaps, governments must prioritize the funding and implementation of new-thinking, cost-effective solutions. At the same time, the global community must invest in research and innovation that makes sustainability more accessible and affordable. Only then can these financial tools evolve from symbolic gestures into meaningful actions of climate resilience and biodiversity protection.
[1] https://www.carbonbrief.org/qa-can-debt-for-nature-swaps-help-tackle-biodiversity-loss-and-climate-change/
[2] https://www.weforum.org/stories/2024/04/climate-finance-debt-nature-swap/
[3] https://www.reuters.com/sustainability/climate-energy/spain-world-bank-launch-debt-swap-hub-free-development-funds-2025-07-01/
