Argentina offers its creditors climate action instead of money

Argentina, one of the world’s most prominent defaulters, is pushing for a new way to service debt: instead of paying creditors with cash that’s in short supply in Buenos Aires, it wants them to recognise the country’s efforts to tackle climate change.

“We need more flexibility to honour that debt,” President Alberto Fernández said at the COP26 United Nations climate summit in Glasgow, referring to the US$45 billion that Argentina owes to the International Monetary Fund. “We’re willing to link part of the payment to essential investments in green infrastructure.”

"We must create mechanisms to pay for eco-systemic services, swapping debt for climate action and installing the concept of environmental debt," declared the Peronist leader at the forum gathering over 120 leaders.

COP26 Climate talks in Glasgow include a discussion on how rich countries can help poorer ones like Argentina to make the expensive transition to cleaner energy.

The idea that the most developed countries pay for the conservation of the natural heritage in countries lacking resources is a recurrent theme in environmental negotiations.

Ecuador’s President Guillermo Lasso announced last Monday that the marine reserve of the Galapagos islands, considered a natural treasure, would be expanded by 60,000 square kilometres and asked for foreign debt to be swapped against thus conserving the archipelago.

"The health crisis of the pandemic only exposed a much bigger crisis (...) affecting the environment, society and the economy," said Fernández in his speech.

Argentina has increased its promises to cut its greenhouse gas emissions by 27 percent from 2016 on the eve of this COP26, recalled the president.

– TIMES/BLOOMBERG/NA