How Biodiversity Loss Could Raise Borrowing Costs And Deepen Debt Risks Worldwide

The Hidden Economic Threat of Biodiversity Loss on Global Debt

Recent research featured in Nature highlights a troubling oversight in financial markets: the economic implications of biodiversity loss are largely ignored, which could put numerous nations on the brink of debt default. Despite growing acknowledgment of environmental degradation as a significant financial hazard, sovereign debt markets still lack mechanisms to incorporate these risks into their assessments. As a result, a staggering US$83 trillion in assets remains vulnerable to mispricing.