An ignored threat? Biodiversity loss could trigger a new global wave of debt crises.

The rapid degradation of global biodiversity could cause a dramatic increase in borrowing costs for governments and trigger a new wave of debt crises, according to a study published Friday. Researchers believe that financial markets are significantly underestimating the economic consequences of ecosystem collapse.

The study predicts that worsening biodiversity loss could increase government interest payments by nearly $162 billion annually worldwide. This increase would result from weaker economic growth, disruptions to supply chains, and the degradation of sectors heavily dependent on nature, such as agriculture, fishing, and tourism.

The authors point out that several large emerging economies could be particularly vulnerable. Countries like China and India could see their financial situation deteriorate to the point of causing a significant downgrade in their credit rating, which would further increase their borrowing costs.

According to researchers, biodiversity is a crucial pillar of global economic activity, but its value is often insufficiently considered in traditional financial models. Species extinction, deforestation, and soil degradation could therefore produce effects comparable to those observed during major economic or climate crises.

The study calls on central banks, rating agencies, and international financial institutions to better integrate nature-related risks into their analyses. The authors specifically believe that the International Monetary Fund and major rating agencies should consider these factors when assessing the financial stability of nations.

This warning comes as many governments are already struggling to cope with high debt levels, rising interest rates, and the consequences of climate change. Researchers argue that ignoring the economic impact of biodiversity loss could increase the financial vulnerability of many countries in the years to come.

While ecosystem preservation is often presented as an environmental issue, this study highlights that it is also a matter of global economic and financial stability. According to its authors, policymakers still have some room for maneuver to limit risks, but this room is shrinking as biodiversity continues to decline.