Biodiversity loss is accelerating at an alarming rate. From deforestation in the Amazon to coral reef degradation in the Indo-Pacific, ecosystems that sustain life on Earth are vanishing. Despite global commitments, the world is failing to meet conservation goals. The problem is not only slow policy responses but a lack of financial resources, particularly in countries harbouring most of the world’s biodiversity.
These countries are caught in a financial stranglehold. Their national budgets are stretched thin, forcing them to prioritise biodiversity harming activities for debt repayments over environmental protection. The resumed biodiversity talks at COP16 in Rome must address this urgent issue. In Rome, as it was in Cali, a contentious and heated negotiation will continue regarding how high-income countries can increase finance to support biodiversity conservation in biodiversity-rich countries.
Without meaningful debt relief, these nations cannot meet their biodiversity commitments under the Kunming-Montreal Global Biodiversity Framework. The stakes are too high to ignore.
Debt traps kill biodiversity
Many biodiversity rich countries spend more on servicing their external debt than on environmental conservation. Madagascar, home to high flora and fauna endemism, faces the challenge of balancing multiple priorities with limited resources—repaying creditors, pursuing social and economic development, and protecting its irreplaceable forests and wildlife. Currently, a large portion of the budget is directed toward debt repayment, raising concerns if conservation and development investments are dwarfed by the scale of the problem. The same is true for countries across the Global South. Instead of investing in ecosystem restoration or sustainable development, governments are forced to funnel scarce resources into meeting foreign debt obligations.
But it gets worse. The pressure to generate revenue for debt service drives governments toward extractive industries—logging, mining, industrial agriculture, and fossil fuel extraction. These short-term revenue streams provide much-needed foreign exchange but come at an enormous ecological cost. Important ecosystems are cleared for timber and palm oil plantations. Mountains are dynamited for mining operations. Wetlands are drained for oil exploration. These activities destroy biodiversity and exacerbate climate change, creating a vicious cycle of environmental degradation and economic dependence.
The economic logic is simple: debt-burdened governments often approve destructive projects because they generate immediate income that can be used to service debt. Financial institutions, including multilateral lenders, often reinforce this trend by supporting infrastructure projects that promote resource extraction rather than sustainable alternatives. This destructive cycle must be broken by lifting the debt burden off biodiversity rich nations.
A just and practical solution
Cancelling debt is not about charity—it’s about saving biodiversity and allowing fiscal space to tackle social development issues. The current biodiversity finance system is fragmented, bureaucratic, and inefficient. Many nations in the Global South struggle to access existing climate and conservation funds due to complex requirements and slow disbursement. Meanwhile, billions flow out of these same countries in debt repayments, draining the very resources needed to implement conservation policies.
Relying on the public funding liberated by debt cancelling can be more independedant than private funding. Often conservation funding from private sources come with conditions that seek to serve vested interests. These conditions do not always align with the needs of local communities or biodiversity protection. Some private donors prioritise commercial interests, favouring a nature for profits rather than those that ensure long-term environmental justice. Other direct market-driven funding, such as carbon and biodiversity offsets, may not benefit the most vulnerable ecosystems or communities.
Debt cancellation would allow public funding to act freely, enabling governments to make independent, long-term investments in conservation, rather than relying on private financiers whose vested interests may conflict with ecological and social justice.
There is a precedent for large-scale debt relief. Programmes like the Heavily Indebted Poor Countries (HIPC) Initiative have proven that when debt is forgiven, governments can redirect funds to essential services like healthcare and education. Expanding this model to include biodiversity protection would have an immediate impact. Debt-for-nature swaps offer another promising solution. Environmental debt swaps exist and, while effective, remain too small in scale.
Time for action
Debt cancellation is a political choice. Wealthy nations and financial institutions have the power to act, but will they? Without bold steps, biodiversity finance will remain a bureaucratic maze while ecosystems continue to collapse. High-income countries must recognize that freeing up financial resources in biodiversity-rich nations is one of the most direct and effective ways to generate income for biodiversity protection.
At COP16, debt relief must be at the centre of the conversation. This is not just about helping individual countries—it’s about securing the planet’s future.
