Ecuador plans to raise money for nature conservation through debt-for-nature swaps and green bonds while continuing oil extraction and mineral mining. The country faces a balancing act between protecting its biodiversity and funding its economy.
In March, IDB Invest and Banco Bolivariano issued a $120 million biodiversity bond for conservation projects. Ecuador completed two debt-for-nature swaps in 2023 and 2024 that freed up about $1.1 billion for conservation in the Amazon and Galapagos Islands. Juan Carlos Blum, Ecuador's minister of environment and energy, said the country hopes to issue its first sovereign green bonds in 2027 to protect coastal and mountainous regions.
Ecuador generates about 80% of its energy from oil and oil products. In October, the government announced plans to open new oil exploration tenders in parts of the Amazon, a move that drew criticism from Indigenous leaders. Blum acknowledged the challenge of balancing biodiversity protection with natural resource extraction.
A new financial tool called biodiversity credits is being introduced in Ecuador. Unlike carbon credits, biodiversity credits track multiple ecosystem measures such as species count and tree canopy cover rather than just carbon storage. They cannot be used to offset emissions. A project at Guayaquil's ESPOL University aims to bring biodiversity credits to a 260-hectare forest area for the first time.
Jerry Toth, co-founder of the nonprofit Third Millennium Alliance, said biodiversity credits could capture ecosystem nuances that carbon markets miss. His chocolate company, To'ak, pays cacao farmers around $1.20 per pound, about double the current market price, to restore degraded land using shade-grown methods.