* Any views expressed in this opinion piece are those of the author and not of Thomson Reuters Foundation.A new U.S. law offers cuts in debt obligations to nations that channel the saved funds to protect critical forests and coral reefs
Michael O’Brien-Onyeka is senior vice president for the Conservation International African field division.
African countries may want to explore the opportunities presented by a recently-passed United States law that offers cuts in debt obligations to eligible nations that commit to channel the saved funds to protect their critical forests and coral reefs.
The Tropical Forest Conservation Reauthorization Act (TFCA) has reactivated a “debt-for-nature swap” program, that has generated the equivalent of $339 million in local currencies since 1998 to protect 67 million acres of forests in 14 countries. The law creating the program had lapsed in 2014 but was reauthorized early this year.
Amid heightening rates of deforestation and limited conservation budgets in many parts of Africa, the TFCA program has the potential to unlock supplementary resources for countries on the continent to protect their key forests and coral reefs.
So far, only one country in Africa—Botswana—has successfully tapped into the program, securing $8.3 million in debt reduction and channeling the funds into restoration of important forests, including in the world-famous Okavango Delta and the Chobe National Park.
The main TFCA beneficiaries have largely been countries in Latin America and Asia, which secured 19 of the 20 ‘debt-for-nature’ deals concluded since the program’s inception. For instance, Costa Rica signed two agreements and saved $53 million in debt repayments that then went into forest conservation. Indonesia sealed three deals that cut its debt to the U.S. by $41.2 million; the saved funds were channeled into conservation on the island of Sumatra.
The debt-for-nature model has proven successful in protecting key reservoirs of nature around the world ever since Bolivia and Conservation International pioneered the model in 1987.
Back then, Conservation International purchased a portion of the country’s foreign debt in exchange for securing commitments for enhanced protection and management of nearly 3.7 million acres of tropical forest in the heartland of the Amazon. This deal helped debt-for-nature swaps take root as an innovative tool for financing conservation.
On the back of the AFR100 Initiative commitment by African countries to bring 100 million hectares of land in Africa into restoration by 2030, Africa needs all the resources it can get to better protect its forests, which play a significant role in the continent’s socio-economic development. The forests provide a range of vital ecosystem services including fresh water, hydroelectricity, biodiversity protection, climate mitigation, food security and jobs among others.
TFCA funds can be used for a wide range of activities including establishment and maintenance of nature parks and reserves, watershed protection, sustainable natural resource management, conservation training programs, and identification of medicinal uses of tropical forest plant life, to name but a few.
And the latest version of the TFCA law includes coral reefs. It is well-known that two-thirds of coral reefs - a crucial natural resource - are threatened with degradation across the globe, including in Africa. Securing them should be a priority since they help to provide food, jobs and protection for almost a half of the world’s population. This also presents additional opportunities for Africa’s 38 coastal states to invest in marine conservation, including mangrove protection and restoration.
TFCA deals have proven to catalyze additional funds from other sources, thus enhancing the pool of resources available for forest protection. For instance, of the $339 million generated in local currencies by TFCA since 1988, the U.S. government invested $233 million, while a number of non-government organizations, such as Conservation International, contributed $22.5 million.
It is up to individual countries in Africa to evaluate the nature of TFCA agreements and weigh if they align with their national interests and priorities. To be eligible for TFCA, countries must have a tropical forest of global or regional significance and meet certain political and economic criteria. TFCA deals are negotiated and finalized bilaterally between the U.S. government and their counterparts in the interested countries.
To help create a better future for Africa’s forests and people, eligible countries on the continent may want to consider the new opportunities created by the ‘debt-for-nature’ program.