Tropical Forest Protection Act of 1989

Tropical Forest Protection Act of 1989 - Requires the Secretary of the Treasury to instruct the U.S. executive directors of specified multilateral development banks to promote the preservation of tropical forests or other endangered ecosystems and species in debtor developing countries by enabling such countries, through debt reduction or restructuring, to buy back private debt at discount rates in the secondary market if such countries: (1) convert an agreed upon amount of debt to local currency for use in "debt-for-nature swap" programs for the protection of such forests, ecosystems, or species; or (2) demonstrate a commitment to the protection of such forests in the form of such swaps for set asides or conservation easements.

Directs the Secretary to instruct such directors to consult with one another to promote debt suspension in such countries as long as environmental protection commitments are maintained. Requires the Secretary to instruct the U.S. executive director to the International Bank for Reconstruction and Development to initiate discussions with other directors and management of the Bank and propose a three-year environmental sector lending program for countries with such commitments to: (1) reduce the future need for lending for reforestation and restoration of environmentally degraded areas; and (2) be based on the estimated long-term economic return expected from the sustainable use and protection of tropical forests and the benefits from maintenance of biological diversity and climate stabilization.

Directs the Secretary to instruct such directors to promote policies which: (1) assist in strengthening nongovernmental organizations in such countries by providing technical assistance and support for environmental protection activities; and (2) encourage international collaboration for information exchange and project enhancement with environmental protection organizations.