About Debt for Climate Swaps

Debt for Climate Swaps (DCS) are a climate finance mechanism that offer value to both debtor nations and creditor entities (countries, multilateral organisations, global financial institutions).

For countries and entities that are owed debt repayments (creditors), debt for climate swaps present an opportunity to have tangible climate impact, at no new additional cost to the creditor. 

For highly indebted, climate vulnerable countries (debtors), debt for climate swaps can help alleviate fiscal pressure by redirecting debt repayments toward climate adaptation, climate mitigation, building resilience, and the green transition. 
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In a typical debt for climate swap or DCS, debtors offer to direct fiscal attention and energy towards climate action, such as projects in reforestation, renewable energy development, conservation, and climate resilience programmes. In return, creditors offer to reduce the burden of debt repayments.
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Debt for Climate Swaps can lead to significant environmental and economic benefits for both creditors and debtors. By easing debt pressures, countries can free up fiscal space, fund environmental projects, support biodiversity, and transition to greener economies – advancing global climate goals while promoting long-term sustainability.