The UN Economic and Social Commission for Western Asia launched a debt swap mechanism for the Arab region, providing countries the opportunity to use debt servicing payments to finance climate change and sustainable development initiatives in partnership with creditors and donors.
The launch follows several ESCWA publications and expert group meetings over three years emphasizing and identifying debt sustainability challenges facing Arab states.
The UN Economic and Social Commission for Western Asia (ESCWA) has launched an initiative to help Arab states finance sustainable development and climate action. The Climate/SDGs Debt Swap Mechanism gives debtors, creditors and donors the opportunity to achieve climate-sensitive national development objectives in line with global development goals.
The initiative was launched during a virtual expert consultation meeting on 15 December 2019. The launch follows three years of publications and expert group meetings which identified the debt sustainability challenges facing Arab states.
The Climate/SDGs Debt Swap Mechanism will foster partnerships between Arab states and their creditors to use debt servicing payments to finance climate change and sustainable development initiatives, “particularly in countries where continuous borrowing has become a less viable option.”
In her opening remarks at the expert consultation meeting, ESCWA Executive Secretary Rola Dashti said the Commission will host the mechanism and “leverage all technical capacities and engagement with member States to support the debt swaps from inception to implementation.” [ESCWA Press Release]