RI, US start discussing 2nd debt-for-nature accord

Antara News, Friday, January 15, 2010 18:44 WIB

Denpasar (ANTARA News) - Indonesia and the United States have begun discussing the substance of their second agreement on a debt-for-nature swap under the US Rain Forest Protection (TFCA) Act, according to the US embassy in Jakarta.

The TFCA Act allows the reduction and transfer of a country`s debt to the US to support the conservation of tropical forests in developing countries, the embassy said in an e-mail received here Friday.

The United States Treasury Department had set aside more than 19 million US dollars to conduct such swaps with eligible developing countries.

Initial discussions on the substance of the second debt-for-nature swap agreement were begun in Jakarta this week by Indonesian and US government representatives.

"This is an important symbol of our partnership with Indonesia on climate change and environmental issues," United States Ambassador to Indonesia Cameron R Hume said.

According to Humme, debt-for-nature agreemts were a practical way for the two countries to work together in protecting forests and reduce the critical impacts of climate change.

Under the First TFCA Agreement, signed on June 30, 2009, the US would reduce the amount of Indonesia`s debt payments to the United States by approximately 30 million US dollars over a period of eight years.

In return, Indonesia would use the deducted amounts to support the protection and restoration of forests in Sumatra.

This the largest "debt-for-nature swap" agreement achieved in the history of TCFA, thanks to the 20 million US dollars contribution from the United States government and the two million dollars combined donation from Conservation International and the Indonesian Biodiversity Foundation, the embassy said.

Until now, 13 countries are participating in the debt-for-nature agreement under the TFCA protocol. Over time, the debt-for-nature program will generate more than 218 million dollars to protect tropical forests.