African countries saddled with debt and ravaged by losses and damages from extreme weather events like cyclones, drought and extreme temperatures have agreed to consider swapping debt to invest in climate action in a meeting of finance ministers in the Ethiopian capital.
The “debt-for-climate swap” option is an economic tool that allows a country’s debt to be reduced in exchange for commitments on green investments. It was among several green financing alternative models discussed at the ongoing United Nations conference that supporters say would boost funds to adapt to climate harms, protect nature and finance local communities.
