Notice
Abstract: The challenge of climate change requires significant investments, but many developing countries are hindered by the burden of external debt. At the same time, developed countries are obligated under the Paris Agreement to finance climate actions in developing countries with an annual commitment of 100 billion USD. However, they have been unable to reach the target and have not fulfilled their obligations. A "Debt for Climate Swap" is an innovative approach to climate finance that allows climate-vulnerable countries to obtain financial resources to implement mitigation and adaptation measures. This mechanism proposes reallocating the debt to climate adaptation and mitigation initiatives that align with the debtor's Nationally Determined Contributions (NDC) under the Paris Agreement. The parties involved in a debt-for-climate swap will guarantee that the funds allocated towards climate adaptation and mitigation efforts are recorded and acknowledged by the UNFCCC Secretariat within the framework of the creditor's commitment under the Paris Agreement.
