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US climate change pullback threatens planned Debt-for-Nature deals
The debt agreements worth billions of dollars that were designed to protect ecosystems in Africa and Latin America could unravel or need to be reworked amid fears of the U.S. backing drying up under Donald Trump. Debt-for nature swaps have become more popular in recent years. Deals involving the Galapagos Islands and coral reefs as well as the Amazon rainforest are among the most notable. U.S. International Development Finance Corporation has played a major role in the swapping of debt, with nearly 90% of the $6 billion being covered by the DFC. Sources with direct knowledge said that the DFC has about five swaps on the way. These are now being questioned by the CEO-in-waiting Ben Black, and the U.S. Government efficiency chief Elon Musk. Source did not specify the amount of debt covered by swaps, but noted that the last DFC-backed transactions involved more than $1 billion per deal. Requests for comments on the future involvement of the DFC in such deals were not responded to by the White House or the DFC spokespersons. Unnamed DFC officials confirmed that they stepped down as co-chairs of the global task force established in 2023 for expanding the use of debt exchanges. Scott Bessent, U.S. Treasury secretary, has also criticized multilateral lenders who are working on climate change issues. This comes amid a wider retreat by the U.S. that has seen them withdraw from Paris Agreement in order to reduce global warming. Four sources who have worked directly on the projects say that Angola, Zambia and one Latin American nation are among those countries whose debt-for-nature swap plans may need to be reworked and even abandoned because of uncertainty surrounding DFC. Vera Daves de Sousa, Angola's Finance Minister, said that her country has been in talks with the DFC regarding two possible swaps. Her country is among the most indebted countries in Africa, and its rivers are vital to the Okavango Basin, which supports endangered elephants and Lions. One is a debt-for-nature deal, the other a broader 'debt-for-development' swap tied to education and young people. De Sousa said recently that he felt "openness" from DFC, especially in relation to the debt-for development swap. She added, "We respect their view." "For us, there's no difference. We have opportunities both on the development and nature sides." Things have also changed in Zambia. Late last year, the country was considering a trade involving its large national parks, which are home to more than 40% of Africa's Elephants. Situmbeko Musokotwane, the Finance Minister of South Africa, said that although the swap was not entirely shut down at the moment, the country did not intend to actively pursue it. NEW REALITY Smaller nations that are struggling with debt and climate change can generate money by exchanging expensive government bonds for less expensive ones. According to the UK-based non-profit International Institute for Environment and Development, the 49 world's poorest countries most at risk of a debt crisis could exchange a quarter the $430 billion in debt they currently owe. Sebastian Espinosa of White Advisory, managing director, has advised Barbados and Belize on swaps. These could include credit guarantee from multilateral development bank, along with private sector insurers, and guarantors. The Bahamas pioneered this last year. In the past, DFC support has been critical in scaling up deals. It offers up to $1 billion of political risk insurance. This protects the people who purchase the lower-cost bonds in the event that the governments fail to pay. "Who will step up?" Eva Mayerhofer, at the European Investment Bank who backed a Barbados swap in 2023 said: "I don't know (to replace DFC)." "We won't have the ability to convert debts so regularly." The Inter-American Development Bank (IADB), which has been involved in five out of nine of the debt-for-nature swaps over the past decade, often alongside the DFC, declined to comment on the impact of these swaps on its plans. Stephen Liberatore of Nuveen, a leading investor in debt swaps, says that while it is possible to find substitutes for DFC, its knock-on effect has yet to be determined. What is the cost of a private entity providing risk insurance compared to a public entity such as the DFC? Liberatore stated. "Does this change the amount saved?" The money is then used to conserve. "That is the ultimate question."
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Greece's fire season begins with a test of readiness by firefighters
Firefighters, rescuers, and the Greek army are ready to fight a wildfire that is threatening a summer camp on a hillside near Athens. This scenario has become all too common in Greece where climate change makes fires more destructive and frequent. Greece is now in the thick of wildfire season. The exercise held on Thursday near the seaside village of Lavrio, some 70 km south of the capital, was simultaneously conducted across the entire country. Fire trucks rushed to the scene, and an aircraft sprayed water onto a simulated fire. Authorities described the weather conditions of the drill as "realistic", hot and windy following weeks of drought. Giannis Kefalogiannis, Minister for Climate Crisis and Civil protection, told reporters that "this year also conditions will be very difficult." "We all will go to war." Greece's Mediterranean climate makes it more susceptible to climate change. It recorded its hottest Summer last year, as well as extended periods of drought which led to water shortages, and damaged crops. It is predicted that this June will be warmer than normal in southern Europe. The government plans to deploy an unprecedented number of firefighters - 18,000, up from 15,500 in 2020 - with the help of volunteers. The government will spend 2 billion euros to buy new aircraft, and nearly double the number of thermal camera drones will be used to detect fires earlier. Kefalogiannis stated, "Our goal is not to mourn human life and to protect the property and environment." According to the fire brigade in Greece, there were 9,777 wildfires across Greece in 2018. This is up from 8,257 wildfires in 2023. In 2023, one of Europe's largest wildfires ever recorded burned in the north of Greece for several weeks. At least 20 people died. A wildfire that was fanned to flames by gale-force winds reached the northern suburbs of Athens last summer and forced hundreds to flee. (Reporting and editing by Ed Osmond, KarolinaTagaris)
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The Brazilian Senate has approved a bill that will loosen environmental licensing
The Brazilian Senate approved legislation that will loosen environmental licensing despite criticisms from climate policy groups, and even some members of President Luiz inacio Lula's government. The bill was passed by the Senate on Wednesday night with 54 votes in favor and 13 against. It would allow for projects that are considered to have only a moderate impact such as dams or basic sanitation to be built, without the need to seek approval from environmental agencies. The powerful agribusiness group, including Lula's chief of staff Rui Cost, has endorsed the legislation. The bill highlights the government's divisions over environmental policy, as Lula tries burnishing his green credentials ahead of the country hosting the United Nations Climate Summit known as COP30 at the Amazonian City of Belem. The bill's approval is a serious blow to the Environment Minister Marina Silva who said that the bill was a major setback and would "dismantle" licensing throughout the country. Sources said that the government's ability to negotiate was limited due to its internal divisions. The government engaged in harm reduction by supporting a version that was deemed to have fewer impacts on the existing environmental laws, according to sources. Greenpeace, Brazil's Climate Observatory and a group of environmental groups have criticised the proposal, saying that it robs populations vulnerable, such as Brazil's Indigenous, of their right to participate in projects which could impact their communities. The bill went to vote at a time when Brazil's environmental agency Ibama is under intense scrutiny over licensing delays. This includes a request for drilling by the state-run oil company Petrobras to explore for oil near the coast of Amapa, an Amazonian state. Davi Alcolumbre is a native of Amapa, and has been pushing to develop the oil industry there. Reporting by Ricardo Brito in Brasilia and Lisandra paraguassu Writing by Fabio Téixeira Editing and Conor Humphries Brad Haynes
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Greece's fire season begins with a test of readiness by firefighters
Firefighters, rescuers, and the Greek army are ready to fight a wildfire that is encroaching on a summer camp. This scenario is all too common in Greece where climate change makes fires more destructive and frequent. Greece is now in the thick of wildfire season. The exercise held on Thursday near the seaside village of Lavrio, some 70 km south of the capital, was simultaneously conducted across the entire country. Fire trucks rushed to the scene, and an aircraft sprayed water onto a simulated fire. Authorities described the weather conditions of the drill as "realistic", hot and windy following weeks of drought. Greece's Mediterranean climate makes it more susceptible to climate change. It recorded its hottest Summer last year, as well as extended periods of drought which led to water shortages, and damaged crops. It is predicted that this June will be warmer than normal in southern Europe. The government plans to deploy an unprecedented number of firefighters - 18,000, up from 15,500 in 2020 - with the help of volunteers. The government will spend 2 billion euros to buy new aircraft, and nearly double the number of thermal camera drones will be used to detect fires earlier. Kefalogiannis stated, "Our goal is not to mourn human life and to protect the property and environment." According to the fire brigade in Greece, there were 9,777 wildfires across Greece in 2018. This is up from 8,257 wildfires in 2023. In 2023, one of Europe's largest wildfires ever recorded burned in the north of Greece for several weeks. At least 20 people died. A wildfire that was sparked by gale-force winds in the summer of last year forced hundreds to flee Athens' northern suburbs. (Reporting and editing by Ed Osmond, KarolinaTagaris)
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Gold prices fall from two-week highs as dollar edge higher
Gold prices fell on Thursday, after reaching a two-week high in the previous session. The dollar rose, but concerns about the U.S. government’s growing debt and fiscal outlook kept the price above the $3,300 mark. As of 1020 GMT spot gold was down 0.3%, at $3,303.82 per ounce. It had earlier reached its highest level since the morning session, on May 9. U.S. Gold Futures dropped 0.3% to $3304.10. Ross Norman, an analyst independent, said that "sales coming in from those who are looking to book profit and a certain recovery in the dollar has taken some shine out of gold." The dollar index rose 0.2% against its competitors, making greenback bullion prices more expensive for holders of other currencies. Norman said that there are concerns over the U.S.'s debt management and that gold would remain relatively strong if markets reacted negatively to the tax cuts. Moody's lowered the top sovereign credit rating of the United States by one notch, citing its growing debt pile of $36 trillion. The sale of U.S. Treasury Department bonds for 20 years, valued at $16 billion, was met with a lackluster demand by investors on Wednesday. This impacted the risk-taking attitude among Wall Street investors. Market participants are also concerned that the U.S. debt will increase by trillions of dollar if Congress passes Donald Trump's tax-cut proposal. Gold is used to store value in times of political or financial uncertainty. Dollar index is near a two-week low. This makes bullion attractive to other currency holders. Trump's tax and spending bill passed a critical hurdle on Thursday. The House of Representatives voted along party lines in order to start a debate which should lead to an approval vote later that morning. Other metals, such as spot silver, fell by 0.7%, to $33.14 per ounce. Platinum dropped by 0.7%, to $1.068.97, and palladium was down 2%, to $1.015.97.
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The EU Parliament supports the exemption of 90% of companies from Carbon Border Levy
The European Parliament approved changes to the European Union carbon border tariff on Thursday that will exempt companies that import less that 50 metric tonnes per year of relevant products from the scheme. According to the European Commission, the proposed changes will exempt more than 90 percent of importers from the first Carbon Border Adjustment mechanism, which is the world's carbon border tariff. This will save them time and bureaucratic hassle. The scheme will not lose any of its effect, as more than 99% emissions are associated with the imports that are covered by the border tax on carbon. In February, the Commission proposed changes to replace existing rules that required all individuals and companies who import CBAM-covered products with a price above 150 euros ($170), to pay a levy starting next year. From 2026, companies will be required to purchase permits to cover carbon emissions from importing steel, cement and aluminium, as well as fertilisers. Changes include delaying the sale of these permits until 2027. After the vote of the European Parliament on Thursday, EU member states will have to decide their position next week before they can negotiate the final rules. EU diplomats said that the countries are also expected to support the proposal to exempt 90 percent of companies. The carbon border tax is intended to protect European producers from cheaper competitors in countries with less aggressive climate laws and to prevent them from shifting their investments to other countries, such as the U.S. where President Donald Trump’s administration is aggressively rollingback regulation. The levy imposes a fee equivalent to that paid by EU companies who, under the EU Carbon Market, already pay per ton of CO2 emitted. ($1 = 0.8855 euro) (Reporting and editing by Barbara Lewis; Reporting by Kate Abnett)
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EU labels only four countries as "high-risk" under deforestation laws
BRUSSELS (May 22) - The European Union's new anti-deforestation legislation will place the most stringent checks on commodities from only four countries. Brazil and Indonesia, two major forest nations, are exempted. In a legal document published on Thursday by the European Commission, it was stated that the law will categorise imported goods from Belarus, Myanmar and North Korea as "high-risk" items of fueling deforestation. Brazil and Indonesia will be labeled as "standard risks" because they have historically had the highest deforestation rates. This means that their goods will be subject to lighter compliance checks when exported to Europe. The United States is one of the countries that was labelled "low-risk" and therefore faced less stringent due diligence regulations. The EU law applies to soya, beef, palm oils, wood, coffee, cocoa, and other derivative products such as leather, furniture, chocolate, and cocoa. Companies in countries with high and standard risks will have to provide information on when and where commodities were grown, as well as "verifiable' evidence that the crops were not grown on deforested land after 2020. The main difference between these groups is that EU member states will have to conduct compliance checks on 9% of exporters from countries at high-risk of deforestation. This number will increase to 3% for countries of standard risk and 1% of low-risk. If a company fails to comply, it could be fined up to 4% its turnover in a member state of the EU. (Reporting and editing by Bart Meijer, Charlotte Van Campenhout, Kate Abnett)
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Copper hits three-week low amid economic uncertainty
The price of copper fell to a record low for a third week on Thursday, and the prices of other base metals were also lower as economic uncertainty and a slowing demand growth persist. The benchmark copper price on the London Metal Exchange was down 0.7% to $9,462 per metric tonne by 0938 GMT, after reaching its lowest level since May 1, at $9,223.20. Alastair M. Munro, broker at Marex, said that the metals market was in a state of paralysis following the expiration of LME benchmark contract last week. The sharp increase in Chinese inventories has put pressure on prices Last week, the withdrawals stopped after a run of three weeks. Analysts and traders said the increase was due to the tepid demand for copper in China, and steady production from a growing sector of smelting. The prospect of increased supply was also a factor in the market's reaction after Freeport Indonesia reopened its Manyar smelter, located in East Java, ahead of schedule following a fire that occurred last year. The smelter is expected to start producing copper cathode in the fourth week of this month. Investor sentiment remained subdued despite a deteriorating U.S. financial outlook. The Moody's downgrade last week fueled a growing narrative of "Sell America", leaving the markets in a state of confusion. A weaker dollar helped to limit losses by making metals priced in dollars cheaper for buyers of other currencies. LME lead dropped 1.1% to $1.952 per ton, after reaching its lowest level since May 9, at $1.947.50. Lead inventories on warrant The number of tons sold has risen by 91% in the last two days, to 234,000 tonnes. This is their highest level since December 2024. Other metals saw a 0.2% decline in aluminium at $2467 per ton. Zinc fell by 0.2% to 2,688. Nickel was down 0.9% to $15,450. Tin lost 1.4% to 32,365. (Reporting and editing by David Goodman in Bengaluru)
Two Israeli Embassy staffers killed in central Washington by a lone suspect
Officials said that a single gunman killed two Israeli embassy employees, a young couple who were about to get engaged. The suspect, who was chanting pro-Palestine slogans, is now in custody.
Two people were killed after they left the Capital Jewish Museum, located in Northwest Washington in the vicinity of 3rd Street and F Streets. This is a central Washington area that's about 1.3 miles from the White House.
Pamela Smith, chief of the Washington Metropolitan Police Department, said that a man fired a handgun at a group consisting of four people and hit both victims. He was seen pacing in front of the museum before the shooting.
She said that the single suspect, Elias Rodriguez, 30, from Chicago, had chanted, "Free Palestine, Free Palestine" after being arrested.
Smith stated that "after the shooting the suspect entered into the museum and was arrested by event security." In handcuffs the suspect pointed out where he had thrown the weapon. The weapon was recovered and the suspect implied that the crime was his.
She added that the suspect had never previously been in contact with police.
Yechiel Leiter told reporters that the Israeli ambassador to the U.S. said the young man who was killed "bought a ring last week with the intent of proposing to her next week in Jerusalem."
President Donald Trump condemned this shooting. "These horrendous D.C. murders, which are clearly based on antisemitism must stop, NOW!" He said this in a post on Truth Social. "Hatred, and radicalism have no place in America."
Benjamin Netanyahu, the Israeli prime minister, expressed his sorrow for the families who lost their loved ones to a "heinous antisemitic killer."
"We are seeing the price of antisemitism, and the wild incitement of hatred against Israel. "The blood libels are rising and must be fought until the bitter end," said he in a press release.
POLITICAL AMMUNITION
The shootings may give Netanyahu and his partners on the far right political ammunition for a more aggressive stance in Gaza. They could also generate sympathy from Western allies, who are putting pressure on Netanyahu to lift the aid embargo in the war-ravaged area.
The Palestinian Abu Nidal Group, formed after the Palestinian Liberation Organisation split, shot the Israeli ambassador in the United Kingdom Shlomo Agov on June 22, 1982.
The failed assassination led Ariel Sharon, then Israel's Defence Minister, to launch an offensive against the capital of Lebanon where the PLO was headquartered.
The shooting on Wednesday will also further polarize the U.S. debate about the Gaza war, which has already polarized supporters of Israel with pro-Palestinian protesters.
Trump and his conservative Israel supporters have called out pro-Palestinian protesters as antisemitic.
Trump has cut funding to elite U.S. Universities that, he claims, have allowed antisemitic protests. His administration has also detained foreign students without charge.
'TARGETED VIOLENCE'
The Israeli president Isaac Herzog, as well as the U.S. secretary of state Marco Rubio, condemned the shooting. Homeland Security Secretary Kristi Nomme said on X that "We will bring to justice this depraved perpetrator."
After the shooting, Attorney General Pam Bondi went to the site with U.S. attorney for the District of Columbia Jeannette Pirro.
Don Bongino, Deputy FBI Director, said that the FBI and police were interviewing the suspect.
In a message on X, he stated that "early indications are that this is a targeted act of violence." "Our FBI team has been fully engaged, and we will provide you with answers as quickly as possible without compromising other leads."
According to its website, the American Jewish Committee organized the event at the Capital Jewish Museum. The group is an advocacy group which supports Israel and combats antisemitism.
The online invitation for the event was called the Young Diplomats Reception. It described it as a gathering of Jewish professionals aged between 22 and 45 years old and the Washington diplomatic communities.
After the shooting, a number of people gathered on the scene. One man knelt at the intersection, draped with an Israeli flag.
Aaron Shemtov is a student at a rabbinical school in California. He said that he visited the museum after hearing about the shooting to show his support.
Shemtov stated, "When a community member is murdered, and he gets killed because of who he was, we are proud, strong and never give up."
Rabbi Levi Shemtov who was at the scene said that the couple attended his Washington Synagogue on occasion.
The rabbi said, "It is very sad that these people were shot in the street because of their identity. They were about to be engaged and they should have been celebrating the end of their lives." Reporting by Jasper Ward and Ryan Patrick Jones; Additional reporting in Jerusalem by Hatem Maher, James Mackenzie; Writing by Raju Gopikrishnan and Editing by Edwina gibbs
(source: Reuters)