Since 1985, countries -- particularly in Latin America -- have negotiated several arrangements to reduce their crippling debt burden. They promptly ended up losing the right to decide what to do with the money saved.

In lieu of debt reduction, they have, in what are called "debt for nature" swaps, agreed to conserve their environment; or, in "debt for development" swaps, agreed to invest in development programmes.

In a typical debt for development swap, an international organisation, usually a NGO, purchases sovereign debt at a discount in the secondary market. It then exchanges the debt with the central bank of the debtor country. The local funds generated by the exchange are used to finance development projects in the environment, health and education sectors.