Original paper

Clean Techn Environ Policy 5 (2003) 4149 DOI 10.1007/s10098-003-0180-4

Application of decision analysis in debt-for-environment swaps

M.F. Abu-Taleb

41 international Union for the Conservation of Nature (IUCN) and the World Wildlife Fund (WWF), as well as others, have been involved in debt swaps in Bolivia, Costa Rica, Ecuador, Guinea-Bissau, Madagascar, The Philippines, Poland, and Zambia. The original rationale behind debt-for-environment swap (DFES) stems from the basic premise that developing country debts are paid at the expense of the natural resource base. That is, when struggling with domestic economic problems, developing countries often subordinate the environment to more immediate needs such as job creation. Therefore, the concept of freeing debt burdens specically for the environment ensures sustainability in development programs. Additionally, the government can levy small fees, taxes, and the like on the funds to capture an additional share of the overall benets for itself. Moreover, DFES attracts further attention and funding for environmental issues. This can encourage additional foreign exchange ows and enhance credibility, paving the way for additional debt forgiveness. For creditor nations, it is an investment; for developing nations in debt, it can mean the difference between stagnation and growth of the economy (Kaiser and Lambert 1996). In the late 1990s, the government of Jordan approved the concept of DFES as a means of converting parts of ofcial loans to funding for environmental protection projects. By denition, the DFES is an arrangement whereby debt is written off in return for a commitment to conserve the environment. In a typical transaction, a donor government would agree to swap an amount of outIntroduction standing debt (at secondary market value) for Debt swaps were rst suggested by Thomas Lovejoy in environmental projects and programs in Jordan. A na1984 when he was with the World Wildlife Fund (Moye tional committee would ensure that funds are deposited 1997). From 1987 to 1994, over U.S.$178 million in deinto an earmarked National Debt-for-Environment Swap veloping country debt has been converted, starting with Bolivia. In 1990 and again in 1991, the Paris Club (com- Fund and allocated for donor-approved programs according to Jordanian priorities. This would extinguish the munity of Ofcial Government Creditors) approved the debt swap concept where up to U.S.$20 million in creditor face value of the debt by payment of up to its secondary market value in local funds. claims may be written off for development swaps by The way debt swaps work and are exchanged between Severely Indebted Lower Middle Income Countries. The debtors and creditors can be generalized as follows. A debt swap transaction involves exchanging debt payable in foreign currency for a commitment by the debtor country Received: 31 July 2002 / Accepted: 31 December 2002 Published online: 15 February 2003 (e.g., Jordan) to use local currency for domestic environ Springer-Verlag 2003 mental programs. With bilateral DFES, only the creditor and debtor are involved; a trust fund is set up and directly M.F. Abu-Taleb administered by joint committees. With trilateral DFES, a Department of Civil Engineering, third party (usually an international body or NGO) agrees Applied Science University, PO Box 40, 11831 Amman, Jordan to provide expertise and administer the swap on behalf of E-mail: mtaleb@nets.com.jo Fax: +962-6-5819123 the parties. Thus, a trust fund or an endowment fund can Abstract Through a mandate by the Government of Jordan, a debt-for-environment swap initiative was designed to mobilize resources for programs that improve the Jordanian environment within a broad spectrum of conservation, water supply, sanitation, resource management, ecological protection, environmental education, and pollution abatement technology. As a debtor country, Jordan faces a severe debt burden (with debt-per-capita levels among the highest in the world), and is facing difculty obtaining further credit to ll the gaps in hard currency requirements for imports. Debt swap converts outstanding debt obligations into local currency for approved national environmental programs and projects. With creditor countries favoring debt swap over debt forgiveness in general, and debt swap for environmental technology projects in particular, the initiative was launched to ensure both scal and environmental quality benets. With donors requiring that project development and selection procedures be fair, unbiased, and transparent, a mechanism for ultimate selection was developed by the author solely for the initiative based on multiple objective optimization techniques. This paper formulates the necessary decision-analytic principles for the initiative and presents a discrete, defensible, and transparent model for selection of projects. The model ranks the projects in terms of environment and economic objectives and can be used for other generalized applications.

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be set up to fund projects selected by joint technical committees. This paper addresses the link between debt relief policies and environmental technology enhancements. Since donor countries initially do not have much condence in debtor countries (being so far in debt and not showing much for it), the critical component of debt swap for environment policy is transparency. That is, a debtor country needs to demonstrate and guarantee to donor countries that potential debt swap funds will be spent according to exacting national objectives developed with the participation of all stakeholders. To show how this was accomplished in Jordan, the paper is divided into ve sections. After this Introduction, an outline of the direct benets to Jordan and donor governments in dealing with DFES is presented. The next section deals with the basic concepts of debt swap in alleviating debt burdens and sustaining development by providing proles of Jordans economy and environment. After that, the decision parameters and alternatives of a multiple objective optimization model designed to rank the portfolio of approved projects are presented. The section illustrates how the projects were Fig. 1. Generalized benets of DFES developed and presents the projects in terms of priority with respect to Jordans approved national environment services sector (including government services) 63% of and economic objectives. The nal section summarizes and concludes the paper with ideas for further research. GDP. Jordans economy grew at 2.2% in real terms in 2000. Ination registered 2.5% in 2000. The scal decit has fallen from 18% of GDP in 1991 to 4% in 1996 and to the Benefits of debt-for-environment swap DFESs provide benets to the economy, the environment, present. Foreign debt has been reduced from over 180% of GDP in 1991 to 100% in 2000. With a national per capita and the national welfare of a developing country (Moye income of approximately U.S.$1,500, an external debt of 1998). Debt swaps are valid economic instruments that allow debtor countries to reduce their debt and fund their over U.S.$6.8 billion and a high unemployment rate, economic concerns focus on job creation and growth, poverty development. Experience on debt swap projects has pointed to the fact that debt swap can be a positive sum alleviation, and debt servicing. The country is classied as game where everyone wins. DFES targets environmental a severely indebted lower middle-income country in inprojects with a socio-economic base thereby multiplying ternational economic circles and the 5.2 million people of benets for the communities in the country (see Fig. 1). Jordan exhibit a natural population growth of 3% (World The benets enjoyed by Jordan include the availability Bank 1997). Coupled with the migration waves of recent years, this has caused a tremendous impact on the enviof funds for local environmental protection; increasing ronment including over-exploitation of groundwater supdomestic savings; enhancing Jordans attractiveness to foreign investment; improving environmental quality; and plies and overall degradation of the environmental resource base. Table 1 presents some key facts and gures reducing the debt service burden. Another side benet could be debt relief in the short term and debt forgiveness of relevance (Ministry of Finance 2000). As Jordan faces this severe debt burden (with debt-perin the long term. With the enhanced reputation of capita levels among the highest in the world), it is facing spending on priority areas, the government will have gained further credibility in nancial management for the difculty obtaining further credit to ll the gaps in hard currency requirements for imports. The borrowing cycle development of the country (Abu-Taleb 2000c). thus perpetuates itself and conditions may worsen. This The benets to the donor country include an enhancement of its global environmental position; the valid opportunity to extinguish debt that may otherwise be difcult to collect; and enhancement of overall world trade Table 1. Facts and gures and nance by giving the opportunity to the debtor Area 91,860 km2 country to regain its position in international trade and Population 5.2 million GDP (2000) $ 7.5 billion nance.
Currency Exchange rate Perspectives on Jordans economy and environment GDP/capita Jordan is a small country with considerable economic and External debt environmental challenges at the local, regional, and inDebt service ratio ternational levels. Jordans economy is a small open sys- Population growth Poverty tem with a sectoral distribution as follows: commodityUnemployment Jordanian dinar (JD) 0.708 JD=U.S.$1.00 U.S.$1,500 U.S.$6.8 billion 24% 3.4% 27% of families 14.4%

producing sector 37% of gross domestic product (GDP);

M.F. Abu-Taleb: Application of decision analysis in debt-for-environment swaps

has led to domestic planning which favors present consumption and prot realization, ignoring long term consequences. The resulting mismanagement of natural resources is becoming unsustainable. It is clear that halting environmental degradation and pollution hinges on correcting the imbalances within the economy. Environmental degradation cannot be reversed while the numbers of poor increase by the thousands yearly. The link between economic growth and environmental protection has been clearly emphasized in Jordan as a focal point of government activities. In fact, given the parallel crises in the economy and in natural resources management, Jordan has sought to benet from debt forgiveness and/or debt swap transactions to alleviate the pressure on its scal and monetary policies. In terms of debt swaps, Jordans prospects are high, since: (i) Jordans debt is available and eligible for conversion; and (ii) Jordan has the ability and desire to carry out DFESs. In fact, the Jordanian Government has had an effective debt conversion program with Germany since 1997 in the water supply sector, indicating Jordans willingness to commit scal resources to the environment. Jordans environment is fragile, where 91% of the land area is classied as desert or semi-desert. Problems of water supply and demand are at the forefront of environmental concerns, with groundwater aquifers being exhausted beyond natural recharge rates, causing quantity and quality concerns (Abu-Taleb and Salameh 1994). Surface water supplies are inadequate in terms of quality and quantity, causing health and welfare concerns. Problems of biological diversity and habitat protection, desertication, as well as the promotion of eco-tourism need to be addressed. Air pollution and solid waste management efforts need much nancing to be effective. Table 2 presents some information of relevance. The solutions to some of these environmental problems pose a resource burden, nancially and technically. Jordan remains, however, one of the leading countries in the region to adopt comprehensive environmental protection measures. In the midst of such political interest and will, however, there remains much to be achieved to alleviate pressure on the countrys environmental resources. Jordan has embarked on numerous national level activities to protect, rehabilitate, and enhance the major elements of the environment, including water resources, air quality enhancement, and solid waste management. Jordan is one of the leading countries in the region to have adopted an Environmental Strategy (Ministry of Municipalities, Rural
Table 2. Jordans

Affairs, and the Environment 1991). The 1991 Strategy paved the way for Environment Law No. 12 (ratied in 1995) and created the General Corporation for Environmental Protection (GCEP). Both the Strategy and the Environment Law were followed by a National Environment Action Plan (NEAP) completed in 1995 (Ministry of Planning 1995). With these environmental issues at the forefront of concerns, great efforts are being exerted. The Government of Jordan, represented by the Ministry of Planning as the prime body responsible for strategic planning and aid coordination and the Ministry of Finance, as the prime body responsible for scal policy, has decided that debt swap for environment is a viable option for Jordan. However, these efforts require backstopping, support and follow-up to be able to meet the increasing focus on the environment sector, either by local institutions or international agencies. To respond to Jordans keenness in adopting international environmental agreements and conventions, the donor community is being asked to convert part of Jordans debt to environmental projects executed in-country.

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Project evaluation context Research by the author has shown that environmental problems can be modeled using systems analysis and optimization techniques (e.g., Abu-Taleb and Mareschal 1995; Abu-Taleb et al. 1992; Kloub and Abu-Taleb 1998). Figure 2 illustrates the decision-analytic procedure and the building blocks of the decision model for this specic project selection case. The steps will be elucidated in the next sections. The aim of the modeling endeavor was to determine a ranking of environmental projects in response to national objectives (selection criteria). A generalized multiple objective problem is of the form
Maximize f xsubject tox 2 X 1 where f(x)=[f1(x), f2(x),... fp(x)] is a vector valued criterion function dened over set X, which is assumed to be a closed and bounded set of Rn, and where the real valued function fk(x), n=1,..., p gives the value of the nth criterion point at x. Of course, in order to render the problem nontrivial, the objectives or evaluation criteria are assumed to be in conict and non-redundant. More specically in this case, the problem is structured with the feasible alternatives (projects) being enumerated a priori. Thus the modeling effort is aimed at evaluating a nite number of discrete alternative projects with respect

environmental resources

Resource Water Ecology Protected area coverage Wetlands Species Deforestation/desertication Culture/archaeology Archaeology Cultural heritage

Current state Demand outstrips supply by 50%; groundwater quantity and quality diminished Low Deteriorated state Some endemic species threatened Occurring at a rapid pace Conservation priority Protection/enhancement required

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Fig. 2. Decision-analytic procedure based on multiple objective analysis

to a relevant criteria set. As illustrated in Fig. 2, the decision context involved producing optimal environmental projects with the input of multiple evaluation criteria and the initial list of discrete projects. In order to construct the decision model, decision alternatives (ai2X) were determined from the previously described effort, with multiple evaluation criteria (xi) determined from stated national objectives and stakeholder nalization (as described below). The evaluation was conducted jointly with over 100 stakeholders at a National Workshop and produced an overall ranking of projects by category. Stakeholders included representatives from public, private, and non-government organizations (NGOs), as well as environmental experts from academia.

identication of potential results. Other projects, however, provided signicant detail as to scope and results. The project proposals received were listed under four major categories to help in nal evaluations by focus group participants with project-specic expertise, determined based on the previous work of the participants. The categories included:

Water projects Air and solid waste projects Ecology, biodiversity, culture, and eco-tourism projects Urban environmental policy, planning, and education

Decision alternatives (environmental projects) A set of project proposals were formally received from Jordanian Government Organizations (GOs) and NonGovernment Organizations (NGOs). The proposals were a direct response to a request sent out by the government to concerned parties. The projects received were screened initially for any major nancial and/or technical inconsistencies, and categorized for presentation at a National Debt Swap Workshop whose aim was to rank the projects with respect to agreed national environmental objectives. The projects ranged from environmental research endeavors to actual implementation of environmental technology enhancements. Upon rst screening, it was obvious that some projects were prepared without full exposition of operational methodologies, exacting scopes of work, or
Table 3. Comparison by project category

In order to shed light on the overall direction of the 90 projects that passed the initial screening, tabular summary comparisons are made by category (Table 3), by locality (Table 4), and by cost (Table 5). The data in the tables reveal an almost equal number of projects in each of the four categories, with one-third of all projects located in the central area of Jordan (i.e., Greater Amman and its surroundings with a population of about 2 million). Projects were initiated by either government (GO), non-government (NGO) bodies, or as joint projects between the two. As Table 5 shows, the total cost of water projects was approximately 298 million JD; the cost of air and solid waste projects approximately 94 million JD; the cost of urban environmental policy projects approximately 10 million JD; and the cost of ecology, culture and biodiversity projects approximately 22 million JD. The overall cost for all projects combined was 424 million JD spread over a

Category 1. Water 2. Air and solid waste 3. Urban environmental policy, planning and education 4. Ecology, cultural heritage and eco-tourism Subtotal

Governmental 21 21 8 5 55

Non-governmental 1 4 10 12 27

Joint ventures 0 1 3 4 8

Subtotal 22 26 21 21 90

M.F. Abu-Taleb: Application of decision analysis in debt-for-environment swaps

Table 4. Comparison by locality

Water

Air and solid waste

Urban environmental Ecology, biodiversity Subtotal policy, planning cultural heritage and andeducation eco-tourism GO 3 5 NGO 1 3 6 10 3 Joint 3 GO 1 1 2 1 5 NGO 4 2 1 1 1 3 12 Joint 1 1 1 1 4 34 8 3 33 5 7 90

GO Nationwide Rift Valley North Highlands Central Highlands South Highlands Badia Subtotal 14 1 1 3 1 1 21

NGO

GO 5 1

NGO 2 1 1 4

Joint

1 1

14 1 21

1 1

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Table 5. Comparison by project cost

Requested grant category (thousand JD)

Water

Air, solid wastes and urban NGO 2 1 GO 3 2 3 3 4 2 3 20 NGO 1 1 1 1 3 1 Joint

Urban environment policy, planning and education GO 3 2 2 1 8 NGO 1 1 3 2 3 10 Joint 1 1 1

Ecology, cultural heritage and eco-tourism GO NGO 2 3 3 2 1 11 Joint

GO <100 100250 250500 5001.000 1,0005,000 5,00010,000 >10,000 Total 2 1 5 2 1 1 7 19

1 1 2 1 5

1 3

and to present the degree of differentiation in the data. The point system selected for this procedure ranged from 0 to 5, with 0 implying that the project does not attain the objective at all, and 5 implying that the project achieves the objective fully. As a result of previous information derived from the National Environmental Action Plan as well as other factors relevant to the analysis of this initiative, six major headings for environmental objectives were suggested. Table 6 contains a listing of the objectives that were nally approved by the stakeholders for the Debt-for-Environment Swap Initiative for Jordan. The principle purpose of establishing this list was to help differentiate between the various alternative projects in order to delete unnecessary projects, rank the remainder, and be assured of a logical presentation to creditor countries in implementing the Selection of evaluation criteria most important projects rst. A detailed description of The evaluation criteria (xi, i=1, 2, ..., n) represent the objectives to be optimized by the decision. The criteria are each of these criteria is presented below. designed in such a way as to be non-redundant, complete, and have a realistic scale of measurement. Non-redund- Socio-economics ancy refers to the requirement that criteria are not repet- Under this broad issue, each project was assessed as to itive or overlapping, since this would cause overlaps in how much it contributes to certain socio-economic indiinformation and cause confusion to the decision maker. cators such as: Completeness of criteria implies that the system to be 1. Job creation: this criterion assesses the potential imoptimized has bounded most if not all of the parameters of pact of the project on jobs in close proximity to, or the problem; otherwise optimization becomes an abstract jobs affected by, the project during and after direct exercise on paper, devoid of real world meaning and apimplementation. plication. Scales of measurement must be comprehensible 2. National welfare: this criterion assesses the potential to the decision maker(s) so that the decision maker(s) will for the increase in overall welfare of society as a whole have a clear perception of how well the objective is met. as a result of the project during and after direct imThus scales should preferably be physical units, but a plementation (income, well-being, awareness, health, point system was selected to simplify the overall analysis future prospects, etc.). period of 5 years; i.e., approximately 84 million JD per year. This amount is approximately equivalent to 1015% of Jordans annual debt service. Since this number is rather large for the government to justify as part of an untried debt swap program, projects had to be further screened to (i) decrease the number of eligible projects to a manageable number; and (ii) ensure that selected projects were in line with environmental objectives at the national, governorate, and community levels. Project evaluation based on multiple objective decision analysis was therefore undertaken. Such a decision-analytic framework is well suited to deal with signicant uncertainties, involvement of numerous decision makers, and conicting interests (Abu-Taleb 2000b).

Clean Techn Environ Policy 5 (2003) Table 6. National environmental objectives

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Socio-economics 1 Job creation 2 National welfare Technical feasibility 3 Accurate/reliable input data 4 Measurable results Scope 5 Builds upon previous work Economic feasibility 6 Initial cost of the project 7 Maintenance cost of the project Development sustainability 8 Sensitivity to ecology 9 Sensitivity to nature 10 Sensitivity to culture

9. Sensitivity to the natural resource base: this measure assesses the impacts of a potential project on Jordans natural resources (i.e., land and water). 10. Sensitivity to cultural resources: this criterion will assess the sensitivity of archaeological sites if projects are implemented nearby.

Technical feasibility This issue refers to the technical underpinnings of each proposed project. The criteria used to assess technical feasibility include: 3. Accurate/reliable input data: this criterion addresses the likelihood that the project was based upon accurate research and data and whether the project inputs are The cumulative cost of projects in Priority I and II in reliable. each category amounted to 106 million JD over 3 years. 4. Measurable results: this criterion addresses the poThis is equivalent to 5% of the annual debt service of tential measurement of project results in terms of ease Jordan. and accuracy of measurement. Priority I projects in water involved mostly research into drought management (an issue plaguing Jordan), Scope effects on water of climate changes (similar thrust), and This issue includes the relevance potential of each of the forced migration problems on water supply. The lowest projects in terms of: priority projects involved three wastewater treatment 5. Builds upon previous work: this measure assesses how applications and safeguarding the domestic water sound the project background is by determining how supply for Amman. This last project scored surprismuch the project is based on previously successful ingly low; the low scores were attributed to a lack of work in the same area. depth and detail in actual project development rather than to a disregard for drinking water quality. Economic feasibility Priority I projects in air pollution and solid waste This issue assesses the economic resources necessary to stressed operational projects dealing with air pollution implement potential projects. The economic criteria used from vehicle exhausts, hazardous waste planning, and a to assess projects include: new slaughterhouse development. 6. Initial cost of project: this measure assesses the potential that alternative projects being considered will Priority I projects in biodiversity, culture, and ecoshow a logical cost structure for implementation. tourism involved community-based natural resource 7. Operations and maintenance costs: this measure asmanagement, conservation in protected areas, and sesses the resource cost and ease with which competforestation. A project for monitoring bird areas in ent, trained operators, using available resources can be Jordan was relegated to last place in this category. expected to operate the system in a reliable and ef- Priority I projects in urban environmental policy, cient manner. planning, and education included the number one ranked project out of the total 90 projects submitted: Development sustainability establishment of a childrens museum for nature, enThis issue assesses the sustainable development necessary vironment, and archaeology. One of the main reasons to implement any project This criterion evaluates the efthat this project was ranked rst was the detailed inputs fectiveness of the project with respect to the long term and demonstrated success of the proponent with simenvironmental impact. The environmental criteria used to ilar childrens work that provided employment to local assess projects include: communities. A rail system linking the two major cities 8. Sensitivity to ecological resources: this criterion in Jordan (Amman and Zarqa) was relegated to last compares projects based on the degree of sensitivity place in this category due to perceived pollution of the surrounding ora and fauna. Projects that problems in an urban setting. display minimal environmental impacts and/or Finally, it was clear that detailed proposals that respond have impacts that can be mitigated will be ranked well to the terms of reference and address specic higher. criteria will do well in nal selections in the future.

Ranking of projects With the criteria and alternatives identied, the analysis was run with the criteria weighted on a relative scale from 0 to 100 by each participant in the workshop; the average of all participants weighting was used for the nal weighting of each criterion. Table 7 identies the nal ranking of projects by category. The projects were further grouped by priority based on their exact scores attained during the evaluation; i.e., projects with scores close to each other (within a few percentage points) were grouped into similar priority areas. Priority I projects were then slated for nal presentation to donors to choose from as part of their own debt swap programs. By examining the information displayed in Table 7, the following conclusions and comments can be made:

M.F. Abu-Taleb: Application of decision analysis in debt-for-environment swaps

Table 7. Final ranking of projects by category. The number beside each project refers to the order in which they were initially received

for each category Priority Water projects I I I II II II II II II II III III III III III III III III IV IV IV IV Air pollution and solid waste projects I I I I I I II II II II II II III III III III III III III III III IV IV IV IV IV Biodiversity, cultural and eco-tourism projects I I I I I II II II II II II II II II II II II Ranking of projects within project category 2. Drought management in semiarid climates 3. Effect of global climate changes on waterresources in Badia region 4. Environmental impacts of forced migrationto Jordan 17. Construction of wells to collect rainfallwater in rural regions 1. Sustainable management of irrigation waterand enhancement of quality 21. Implementing wastewater treatment systemfor Amman slaughterhouse 14. Study of environmental impacts for BaqaaBasin area 16. Inventory of surface water resources inJordan 7. Rehabilitation of water distribution inurban areas 22. Community participatory approach to waterharvesting 13. Irrigation network and canal improvementprojects 11. Water supply augmentation projects 10. Wastewater treatment and networksprojects 8. Construction of national water carrier 9. Water desalination projects 5. Water resource assessment projects 6. Water feasibility studies 12. Institutional restructuring projects 19. Engine overhaul efuent treatment plant improvement 18. Aqaba airport sewage treatment plant 15. Safeguarding domestic water supply inAmman 20. Industrial wastewater treatment 20. Inspection stations for air pollution andnoise 18. Fermentation of organic fertilizers 1. Hazardous waste site rehabilitationproject 26. New slaughterhouse in Salt city 9. Management of agricultural plastic waste 19. Recycling and composting for Amman solidwaste 2. Waste recycling and utilization to set updunghill from waste 4. Medical waste management in Jordan 3. Solid waste management in Amman IndustrialEstate 10. Reception facilities for ship andport-generated general waste 22. New poultry slaughterhouse 23. New slaughterhouse for cattle and sheep 8. Establishment of Incineration plants forsolid waste in Amman/Zarqa 15. Catering A/C and refrigerator systemsreplacement with ozone free 14. Transfer of food remains to useful food 12. Bio-augmentation program 5. Studies on composition and characteristicsof solid waste 6. Construction of organic fertilizer factory 7. Soil and water investigation at landlldisposal sites 24. Implementation of chiller facility in newAmman slaughterhouse 13. Recycling paper, plastic and othermaterials to useful items 21. Implementation of fodder factory forwaste of Amman slaughterhouse 17. Waste exchange bank 11. Clean room by using highly efcientparticulate air lters 25. Construction of a new landll 16. Hazardous waste management plan 10. Community-based natural resourcesmanagement 1. Integrated conservation of wadi Mujibprotected area and catchment 14. Survey of watershed management in Petra 7. Rehabilitation and development plan for selecteddesert castles 15. National forestation 9. Integrated conservation and developmentfor the Karak Governorate 17. Al-Hussein national park and Al-HassanForest 13. Integration of local community in theprotection of Petra 21. Ajloun ecological tourism developmentproject 19. Implementation of integrated coastal zonemanagement/Aqaba 4. Protection of forests in Jordan 3. Marine conservation center/Aqaba 16. Madaba tourist camp 8. Highway planting project 12. Program to combat desertication 18. Bio-pollination and biological pestcontrol services 5. Publication of a series of children books

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Clean Techn Environ Policy 5 (2003) Table 7. (Continued)

Priority III III III III

Ranking of projects within project category 11. Capacity building of nationalinstitutions for forest protection 20. Restoration and rehabilitation of oldtraditional buildings in Salt 6. Biodiversity study of the Jordan riftvalley and nature reserve 2. Monitoring of important bird areas inJordan

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Urban environmental policy, planning, and education I 2. Natural, environmental, and archaeologicalmuseum (FOE) I 10. Reclamation of Marka garbage dump land I 3. State of environment report I 17. Institutional strengthening for SD andnature conservation I 9. Separate, recycle, benet initiative inAmman II 4. Economic, environmental, and communitydevelopment at Qastal II 18. Sorting, collecting, and recycling paperand cardboard in Ruseifa schools II 6. Pilot action plan for trainingenvironmental media in Jordan II 15. Reclamation and rehabilitation ofabandoned quarry sites II 19. Waste disposal project for Salt II 16. Jordan sustainable cities program II 13. Protection of industrial sites in Jordan II 20. Analysis of impacts of reallocation orrigation water to domestic use II 11. Marketing fruits and vegetables producedwith environmentally friendly methods II 7. Cancer environmental exposure assessmentand intervention research II 21. Improving on-farm water management in theJordan Valley III 5. Industrial estate auditing III 1. Establishment of environmental economicspolicy center III 8. Development of national land use planningand zoning system III 12. Conservation and rehabilitation of Irbidcity center III 14. Light rail system between Amman and Zarqa

As the initiative develops, further projects will be developed by GOs and NGOs on a semi-annual or annual basis to respond to donor demand for high priority projects and programs and to approach the 1020% of Paris Club debt that can be swapped for environmental projects. The foregoing effort will be the benchmark for all future selections and will benet both project proponents and ofcials working in debt swap. But again, a transparent methodology where various stakeholders are necessarily involved in project selection with respect to approved national objectives will be needed.

oped to implement the initiative and select projects. The selected projects stress sustainability and welfare promotion. Typical projects include those dealing with water supply and sanitation, solid waste management technologies, ecological protection, and environmental education and policy. Even though this paper did not address any of the institutional or organizational constraints faced in the development of a debt swap for environment initiative, it is hoped that the work will inspire environmental policy makers in both donor and debtor countries to take advantage of the benets of debt swap. With this paper, Summary and conclusions another step has been taken to ensure that environmental This paper addressed the critical link between debt relief protection technologies and sustainable human developand public investment for environmental protection in ment are integrated for the benet of future generations. Jordan. With Jordanian debt at 100% of current GDP, the country faces a severe debt burden causing difculty in References obtaining further credit. The resulting management of Abu-Taleb M (1994) Regional cooperation in Middle East water renatural resources is becoming unsustainable. The rasources management. In Boulding E (ed) Building peace in the tionale for applying debt swap in Jordan is simple: in Middle East. Lynne Rienner Publishers, Colorado, pp 251264 order to lessen Jordans debt burden, one can ask for Abu-Taleb M (2000a) Impacts of global climate change scenarios on water supply and demand in Jordan. Water Int 25(3):457463 debt forgiveness and/or ask for debt swap. The rst opAbu-Taleb M (2000b) Application of multicriteria analysis to the tion is clear and obvious but very difcult to attain bedesign of wastewater treatment in a nationally protected area. cause of political obstacles. On the other hand, if Environ Eng Policy 2:3746 programs are developed where some of the debt is kept Abu-Taleb M (2000c) Jordans last chance at debt management. Jordan Times, 25 July inside the country and spent on prioritized environAbu -Taleb M, Mareschal B (1995) Water resources planning for the mental projects, then Jordan has much to gain (AbuMiddle Eastapplication of the PROMETHEE V multicriteria Taleb 2000c). method. Eur J Oper Res 81, pp. 500511. Based on just such a concept, a mandate was issued by Abu-Taleb M, Salameh E (1994) Environmental management in Jordan: problems and recommendations. J Environ Conserv the government to demonstrate and guarantee to donor 21(1):3540, Spring countries that potential debt swap funds will be spent M, Deason JP, Salameh E, Mareschal B (1992) Multiobaccording to exacting national criteria. Thus, a transparent Abu-Taleb jective decision support for water resources planning. In: Garber process was followed of stakeholder involvement and deA, Salameh E (eds) Jordans water resources and their future cision maker input. A decision-analytic model was develpotential. Jordan University, pp 7997

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Central Bank of Jordan, Monthly Statistical Bulletins (19992001) Hayward J (1995). Averting a water crisis in the Middle East and North Africa. In: Serageldin I, Sfeir-Younis A (eds) Effective nancing of environmentally sustainable development: Proceedings of the Third Annual World Bank Conference on Environmentally Sustainable Development. The World Bank, Washington, D.C., 4 6 October, pp 274276 Kaiser J, Lambert A (1996) Debt swaps for sustainable development: a practical guide for NGOs. IUCN/SCDO/EURODAD, IUCN Gland, Switzerland, and Cambridge, U.K. Kloub B, Abu-Taleb M (1998) Application of multi-criteria decision aid to rank the JordanYarmouk basin co-riparians according to the Helsinki and ILC Rules. Water Int 23(3):164173, September

Ministry of Finance (19972001) Annual bulletins Ministry of Municipalities, Rural Affairs and the Environment, and IUCN (1991) National environment strategy: guidelines and action plan Ministry of Planning (1995) National environmental action plan Moye M (1997) Mobilizing resources for national desertication funds through debt-for-environment swaps. UNSO, UNDP Moye M (1998) Debt-for-environment swaps for national desertication funds: an introductory guide. UNSO, UNDP World Bank (1996) World debt tables 1996: external nance for developing countries. Washington, D.C. World Bank (1997) Global development nance 1997. Washington, D.C.

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