In the largest debt-for-nature swap the U.S. government has organized so far under the U.S. Tropical Forest Conservation Act, the United States has signed an agreement with Indonesia to forgive nearly $30 million in debt.
The U.S. government has agreed to forgive $30 million in Indonesian debt in exchange for Indonesia’s agreement to protect Sumatran forests, according to Conservation International.
Indonesia is said to be the world’s largest emitter of carbon dioxide, behind the United States and China, because of its deforestation rate. These forests are home to critically endangered Sumatran rhinos, tigers, orangutans, and other rare wildlife.
How it works (in a nutshell)
Instead of repaying the debt, Indonesia is to place the money in a trust, to be paid over eight years, which will be used to protect 13 forest areas on Sumatra. Grants from the trust will be issued for critical forest conservation and restoration work in Sumatra.