Insight, Biodiversity Bonds market
Debt-for-nature swap examples: five recent deals compared by size, credit support and conservation funding
By Growth Market Reports Research, published , updated
A debt-for-nature swap (the parties now usually call it a debt conversion for conservation) lets a country buy back expensive debt with a cheaper new bond or loan and commit part of the savings to nature. Five recent deals show how it works in practice: Ecuador's Galapagos (2023) and Amazon (2024) conversions, Gabon (2023), El Salvador (2024) and The Bahamas (2024). Measured by conservation money per dollar of debt refinanced, they range from about 20% to about 41%.
Debt-for-nature swap examples at a glance
The table sets out the five largest or most recent deals, using figures published by the U.S. International Development Finance Corporation (DFC), The Nature Conservancy (TNC) and the arranging banks. The last column is our own arithmetic: conservation funding divided by debt refinanced or repurchased.
| Deal | Closed | Debt refinanced | Credit support | Conservation funding | Focus | Conservation per dollar |
|---|---|---|---|---|---|---|
| Ecuador, Galapagos | May 2023 | USD 1.628B of bonds bought back; USD 656M new bond | DFC USD 656M insurance, IDB USD 85M guarantee | USD 323M over 18.5 years | Marine reserve | About 20% |
| Gabon | August 2023 | USD 500M, 15-year blue bond | DFC political risk insurance up to USD 500M | About USD 163M over 15 years | Ocean, 26% to 30% protected | About 33% |
| El Salvador | October 2024 | USD 1.031B of bonds repurchased with a USD 1B loan | DFC USD 1B insurance, CAF USD 200M letter of credit | USD 350M over 20 years | Lempa River watershed | About 34% |
| The Bahamas | November 2024 | USD 300M loan | IDB USD 200M guarantee, Builders Vision USD 70M, AXA XL USD 30M | USD 124M over 15 years | 6.8M hectares of ocean | About 41% |
| Ecuador, Amazon | December 2024 | About USD 1.53B of bonds | DFC USD 1B insurance | About USD 460M | Amazon forests and 18,000 km of rivers | About 30% |
Sources for each row are linked in the deal sections below.
How a debt-for-nature swap works
Every deal in the table follows the same four steps. First, the country buys back some of its outstanding bonds, usually trading below face value, through a tender offer. Second, it pays for the buyback with a new bond or loan that carries a lower coupon and a longer maturity. Third, a development finance institution or insurer, most often the DFC, wraps the new debt in political risk insurance or a guarantee, which lifts its credit rating well above the country's own. Fourth, the country commits a share of the savings to a conservation trust fund, paid in yearly instalments, with part set aside as an endowment that keeps paying after the deal ends.
The structure is one of several in the biodiversity bonds market, which Growth Market Reports sizes at USD 21.8 billion in 2025, growing to USD 52.3 billion by 2034 at a CAGR of 10.2%. Most of that value is the nature share of ordinary green bonds. Debt conversions sit in the fastest-growing bond type, alongside outcome bonds and sustainability-linked bonds with biodiversity targets.
Ecuador Galapagos (2023): the largest marine conversion
In May 2023 Ecuador bought back USD 1.628 billion of its international bonds and replaced them with a USD 656 million Galapagos Marine Bond. The DFC provided USD 656 million of political risk insurance, the Inter-American Development Bank (IDB) added an USD 85 million guarantee, and 11 private reinsurers took more than half the risk. Credit Suisse was the bank among the deal parties. The DFC puts Ecuador's lifetime debt service savings at more than USD 1.126 billion. Conservation receives USD 323 million over 18.5 years, about USD 12 million a year, and an endowment is projected to exceed USD 227 million by 2041.
Per dollar of debt bought back, Galapagos commits the least of the five deals (about 20%). But it retired the most debt, which is why its fiscal savings are the largest.
Gabon (2023): the first in mainland Africa
Gabon's August 2023 deal was the first debt conversion in mainland Africa, according to TNC, and the largest amount of new debt raised for a TNC-led project at the time. It refinanced USD 500 million of national debt through a 15-year blue bond, with DFC political risk insurance of up to USD 500 million. Bank of America was sole initial purchaser, structuring agent and bookrunner. Gabon expects about USD 163 million for ocean conservation over 15 years, including USD 5 million a year, and committed to expand marine protected areas from 26% to 30% of its ocean.
El Salvador (2024): the first freshwater conversion
El Salvador's October 2024 deal is the largest debt conversion for a river and its watershed. JPMorgan Chase was sole arranger and lender of a USD 1 billion loan that repurchased USD 1.031 billion of bonds. The DFC insured the loan for USD 1 billion and CAF, the development bank of Latin America, added a USD 200 million standby letter of credit. The deal earmarks USD 350 million over 20 years for the Rio Lempa, which covers 49% of the country and supplies 68% of its water: USD 200 million in direct program funding and USD 150 million for an endowment. The DFC puts lifetime savings for El Salvador at more than USD 352 million.
The Bahamas (2024): no DFC insurance
The Bahamas deal of November 2024 shows a different form of credit support. Standard Chartered funded a USD 300 million loan, backed by a USD 200 million partial credit guarantee from the IDB, a USD 70 million collateralized guarantee from Builders Vision and USD 30 million of credit insurance from AXA XL. It is expected to generate USD 124 million for conservation over 15 years, plus about USD 8 million of endowment returns, and covers 6.8 million hectares of ocean in marine protected areas.
It is the smallest deal in the table but commits the most per dollar (about 41%). Smaller countries with fewer bonds outstanding tend to negotiate larger conservation shares, because the fixed cost of the structure is spread over less debt.
Ecuador Amazon (2024): the largest terrestrial conversion
Ecuador returned to the market in December 2024 with its first debt conversion for the Amazon, refinancing about USD 1.53 billion of international bonds with USD 1 billion of DFC political risk insurance, and with Bank of America and TNC among the parties. The deal generates about USD 460 million for conservation, including USD 19 million a year for 17 years, and the DFC puts Ecuador's net fiscal savings at more than USD 800 million by 2035. It funds better management of 4.6 million hectares of existing protected areas, protection of 1.8 million more hectares of forest and wetland, and 18,000 kilometers of rivers.
What the deals have in common
- Credit support decides the savings. Four of the five deals relied on DFC political risk insurance, and the fifth on IDB and private guarantees. Without that support, the new debt would cost almost as much as the old debt and there would be no savings to share.
- A small group of banks arranges them. Credit Suisse, Bank of America, JPMorgan and Standard Chartered were the banks behind these five deals. By Growth Market Reports' analysis, the five leading arrangers of biodiversity bonds together handled about 31% of market volume.
- Money flows through trust funds. The conservation payments go to independent funds, such as the Amazon Biocorridor Fund in Ecuador, rather than to government budgets, and each deal builds an endowment that continues after the debt matures.
- TNC structures most of them. TNC has closed six Nature Bonds projects, in Seychelles, Barbados, Belize, Gabon, The Bahamas and Ecuador, and expanded its NatureVest team in August 2026 to build its pipeline.
Where debt conversions fit in the wider market
Debt conversions are the most visible biodiversity deals, but they are a small part of the money. Most biodiversity finance still arrives as one eligible category inside broader green bonds, which make up 83% of the biodiversity bonds market by value. Ocean-focused conversions such as Galapagos, Gabon and The Bahamas also overlap with the blue bonds market, and marine and coastal ecosystems are the fastest-growing application in our analysis.
Regionally, Europe holds 41% of the market, Asia Pacific 28%, Latin America 14%, North America 11% and the Middle East and Africa 6%. Latin America and Africa carry a larger share of biodiversity finance than of labeled bond issuance, largely because of the conversions described above.
The pipeline depends on policy. Target 19 of the Kunming-Montreal Global Biodiversity Framework calls for at least USD 200 billion a year of biodiversity finance by 2030 from all sources. Newer structures are also competing with conversions for the same issuers: Chile chose a EUR 1.5 billion sustainability-linked bond with a standalone biodiversity KPI in January 2026 rather than a buyback. For the full segment, region and arranger data, see the Growth Market Reports biodiversity bonds market report.
Segment, regional and company data for 2023 to 2034, with a free sample.
Frequently asked questions
What is an example of a debt-for-nature swap?
Ecuador's 2023 Galapagos deal bought back USD 1.628 billion of bonds with a USD 656 million insured bond and committed USD 323 million to marine conservation over 18.5 years. El Salvador, Gabon, The Bahamas and Ecuador's 2024 Amazon deal followed the same model.
What is the largest debt-for-nature swap?
By debt retired, Ecuador's 2023 Galapagos conversion is the largest, at USD 1.628 billion of bonds bought back. By conservation funding, Ecuador's 2024 Amazon deal is the largest, at about USD 460 million, and El Salvador's USD 1 billion loan is the largest for freshwater.
How much of the savings goes to conservation?
In the five deals compared here, conservation funding equals about 20% to 41% of the debt refinanced. The Bahamas committed the most per dollar (USD 124 million on USD 300 million) and Galapagos the least (USD 323 million on USD 1.628 billion).
Who arranges debt-for-nature swaps?
A small group of banks: Credit Suisse worked on Galapagos, Bank of America arranged Gabon, JPMorgan lent to El Salvador and Standard Chartered to The Bahamas. The Nature Conservancy structured most deals, and the DFC or IDB provided the credit support.
Are debt-for-nature swaps part of the biodiversity bonds market?
Yes. Growth Market Reports counts their conservation commitments in the biodiversity bonds market, worth USD 21.8 billion in 2025 and projected to reach USD 52.3 billion by 2034, within the fastest-growing bond type alongside outcome and sustainability-linked bonds.
Sources
- U.S. International Development Finance Corporation (DFC), "Financial Close Reached in Largest Debt Conversion for Marine Conservation to Protect the Galapagos", 2023-05-09
- The Nature Conservancy, "The Nature Conservancy Announces Debt Conversion for Ocean Conservation in Gabon, First Ever in Mainland Africa", 2023-08-14
- Bank of America, "Bank of America Refinances Gabon Sovereign Debt for Nature and Ocean Conservation", 2023-08-15
- U.S. International Development Finance Corporation (DFC), "World's Largest Debt Conversion for Conservation of a River and its Watershed Completed in El Salvador", 2024-10-16
- The Nature Conservancy, "The Nature Conservancy Announces Innovative Nature Bonds Project in The Bahamas", 2024-11-21
- U.S. International Development Finance Corporation (DFC), "DFC Announces $1 Billion in Political Risk Insurance for Ecuador's First Debt Conversion to Support Terrestrial and Freshwater Conservation in the Amazon", 2024-12-17
- The Nature Conservancy, "The Nature Conservancy Expands NatureVest Team to Accelerate Rapid Growth", 2026-08-05
- Secretariat of the Convention on Biological Diversity, "Kunming-Montreal Global Biodiversity Framework, Target 19", 2022-12
- Crédit Agricole CIB, "Crédit Agricole CIB supports the Republic of Chile on its first Sustainability-Linked Bond with a standalone biodiversity KPI", 2026-01-14