***********************************************
WORLDWIDE
FOREST/BIODIVERSITY CAMPAIGN NEWS
New
Moves in Debt-for-Nature Swaps
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Forest
Networking a Project of Ecological Enterprises
http://forests.org/
2/27/98
OVERVIEW,
SOURCE & COMMENTARY by EE
Following
is an important story from the InterPress Service that
somehow
slipped through the cracks here.
Support for debt-for-nature
swaps
have emerged from unlikely quarters in the U.S. Major financial
transfers
are going to be required if debt-ridden tropical countries
are to
have any hope of being able to forgo short-term development
revenues
to pursue longer-term forest conservation and preservation
goals. Forgiveness of debt is only the
beginning--development and
conservation
funds and technology transfers will be equally important.
g.b.
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RELAYED
TEXT STARTS HERE:
Title: US: New Moves in Debt-for-Nature Swaps
Source: InterPress Service
Status: Copyrighted, contact source to reprint
Date: February 9, 1998
Byline: Danielle Knight
WASHINGTON,
Feb. 9 (IPS) - Two conservative U.S. congressmen, trying
to
shake off their anti-green image, are sponsoring legislation which
would
forgive 400 million dollars of debt owed by developing countries
if the
money is used to save rain forests.
The
Tropical Forest Conservation Bill, being pushed by republicans,
Robert
Portman and John Kasich - both of Ohio - would empower
President
Bill Clinton to reduce or ''forgive'' debt owed to the
United
States by developing nations. In return, the nations concerned
would
establish tropical forest funds to be used for activities
ranging
from reforestation to water conservation.
The
proposed legislation has drawn a warm response from such
environmentalists
as the World Wildlife Fund, Conservation
International
and Nature Conservancy.
''The
bill underscores a turning point for tropical forest
conservation,''
says Peter Seligman chairman of Conservation
International,
one of the largest environmental groups based here.
''It
points out there is no question that tropical forests are
essential
for sustaining life on earth.''
Other
environmentalists and indigenous organisations, however, are not
so
entusiastic. Despite the benefits of protecting critical parts of
the
biophere, some critics say the proposed legislation will open up
countries
to unsustainable natural resource exploitation.
Others
also worry that the bill, resembling the controversial ''debt
for
nature swap'', could undermine efforts of indigenous people to
achieve
self-determination.
The
scheme began during the time President George Bush headed the U.S.
administration
as part of the ''Enterprise for the Americas
Initiative.'' It was intended to open up the economies of
Latin
American
and Caribbean countries to trade, by reducing their debt
obligations.
For the past decade, numerous developing countries have
been
forgiven their interest payments in exchange for environmental
initiatives.
Under
debt-for-nature swaps, a nation's debt is purchased by a third
party
at a substantial discount - or the debt is simply canceled. The
proposed
legislation expands this concept to include more countries
and
become more easily utilised.
Under
the new Bill, money would be set aside in environmental trusts
to
manage and protect the tropical forests. Initially, the debt
restructuring
would be open to selected countries determined to have
the
most biologically-rich forests at greatest risk of destruction.
The
international debt crisis that started in the late 1970s left many
developing
tropical nations unable to repay loans to foreign
creditors.
This often led countries to the rapid development of
natural
resources and the massive exploitation of forests and other
raw
materials with little thought of the environmental consequences,
says
Seligman.
''Tremendous
economic pressure has devastated many of the world's
tropical
rain forests,'' he observes. ''This year alone, more than 30
million
acres were lost. Meanwhile, these countries still haven't been
able to
make a dent in their debts.''
Supporters
of the legislation say they have learned from past
experience
and recognise that more local participation is needed in
order
for this type of debt for nature scheme to work. Under the
proposed
bill, national governments would create the boards that would
review
grant applications and distribute funds.
The
bill mandates a mixed membership on those boards, including U.S.
representatives
and local nongovernmental organisations. The projects
themselves
would be carried out at the local level by local and
indigenous
peoples' organisation but, even with these positive ''win-
win''
aspects, the legislation still has its green critics.
In
order for a developing country to be eligible, they are required to
be
opening up their economies for free market investment. They must
put in
place reforms mandated by international development bank loans.
''This
potentially may open up countries to exploitive development,''
Carol
Welch, a policy analyst with Friends of the Earth, told IPS.
''We
support many aspects of the proposed bill, but we fear that this
eligibility
requirement could lead to the rapid exploitation of
natural
resources - including tropical forests.''
Some
environmentalists also remain puzzled by why normally anti- green
republicans
are pushing this legislation. Because republicans do not
usually
back environmental initiatives and foreign aid programs, some
critics
view the action by Kasich and Portman merely as as a public
relations
exercise - in time for elections in November.
Both
politicians have a poor environmental record, according to the
Washington-based
League of Conservation Voters, an environmental group
that
closely monitors politicians. This year, Kasich and Portman voted
for
weakening the Endangered Species Act and for various anti-
environmental
grazing policies. They also voted to place anti-green
limitations
on United Nations-designated world heritage sites in the
U.S.,
biosphere reserves, and national parks, a League spokesman said.
''It
was a little bit of a surprise to see Portman and Kasich on board
with
this issue,'' said Will Singleton, a policy analysts at
Conservation
International. ''But Portman is very eager to find new
ways of
tackling old problems.''
Singleton
says fiscally conservative republicans, like Portman and
Kasich,
seem to favour the bill because it mandates that their be no
budgetary
impact. The 400 million dollars that would be used to offset
debt
reduction would need to be cut from another area of the budget.
The
first debt for nature swap took place in July 1987. Conservation
International
raised money to pay off 650,000 of Bolivian debt because
the
country was having difficulty paying its loans. The original
lending
institution, Citibank sold the debt to the environmental
organisation
for about 15 cents to the dollar. In return, Bolivia's
president
agreed to set aside the value of the original debt to
protect
several million acres of tropical forest.
Since
then debt for nature swaps have been arranged or explored in
many
developing countries including Ecuador, the Philippines, Zambia,
Jamaica,
Guatemala, Venezuela, Argentina, Honduras and Brazil. But
during
a 1991 conference in Brazil organised by the Brazilian
Institute
for Economic and Social Analysis (IBASE), participants took
a
strong stand against debt for nature swaps.
A
statement summarizing the meeting said, ''such transactions are part
of a
more general strategy for converting debt, reaffirming the
creditors'
political and economic domination over the debtors within a
development
model which commercialized life in all its aspects.''
(END/IPS/dk/mk98)
Origin:
ROMAWAS/ENVIRONMENT-US/
----
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