Pakistan to ink debt-for-nature swap deals with Western Europe

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Staff Reporter
Islamabad

Pakistan is all set to sign agreements with Germany, Italy, Canada and the United Kingdom on June 5 for ‘millions of dollars’ in debt relief in exchange for investments in environmental conservation efforts across the country, Minister of State for Climate Change Zartaj Gul said.

The South Asian nation is working with lender countries on a debt-for-nature (DFN) swap programme, which would see debt relief in return for binding commitments to achieve conservation targets, with lender countries agreeing to reduce Pakistan’s outstanding payments and channeling the money into conservation and climate-related expenses instead.

The state minister for climate said the signing of the DFN agreement was part of a lineup of events for World Environment Day on June 5, which Pakistan will be hosting for the first time.

‘The memorandums of understanding under the debt-for-nature programme will be signed on June 5,’ Zartaj Gul, said in an interview with Arab News, saying Pakistan had assured creditors of its commitment to combat climate change in exchange for ‘the amount of loans they will forgive.’

‘We will not pay back the debts, but against that part of the loan, we will make progress on the restoration of the natural environment, whether it will be biodiversity conservation or restoration, or be it green jobs,’ Zartaj Gul added.

She said the exact amount for the DFN agreement would be determined ‘after the final ratification of the agreement by the respective governments.’

‘Nature-based solutions in exchange for debt relief will not only reduce Pakistan’s debt burden but will also benefit the environment in the country and the region as a whole.’

Zartaj Gul said Pakistan had qualified for the DFN deal based on its ‘three-year performance’ in conservation efforts, including the prestigious 10 Billion Tree Tsunami program launched by Prime Minister Imran Khan in 2018 which aims to counter extreme weather conditions in Pakistan that scientists link to climate change.