Standing in a community building surrounded by Costa Rican rainforest, José Ulises Uva Ríos reflects on the role of carbon finance in forest conservation. As president of the Cabécar Talamanca Association (ADITICA), he has witnessed its impact.
ADITICA is integral to Costa Rica's efforts to reduce deforestation and forest degradation, generating carbon credits. Under the Emission Reductions Payment Agreement (ERPA) with the Forest Carbon Partnership Facility (FCPF), Costa Rica receives payments for verified emissions reductions. These funds are distributed through Costa Rica’s Payment for Environmental Services (PES) mechanism, acknowledging local communities' role in conservation.
Costa Rica's tropical rainforests cover nearly half its land, establishing it as a leader in conservation. The ERPA, signed in December 2020, allows up to $60 million across three payments for reducing 12 million tons of carbon emissions by 2025. Recently, Costa Rica received a second payment of $17.5 million after an initial $16.4 million payment in August 2022.
Maria Elena Herrera, project coordinator and Head of the REDD+ Secretariat, notes: “This project has generated a lot of capacity...These resources complement those needs that the people have.”
With support from the World Bank and FCPF, Costa Rica leads jurisdictional REDD+ markets and was the first Latin American country to receive FCPF payments for reducing emissions from deforestation and degradation. It also became the first country to sell "excess" carbon credits through an agreement with a LEAF Coalition member.
Jorge Mario Rodriguez Zuniga, Vice Minister of Environment states: “FCPF has contributed to generating robust data...ensuring the continuation of payments for environmental services.”
Costa Rica is enhancing its PES program by incorporating biodiversity and freshwater conservation.
A new initiative supported by the EnABLE Trust Fund focuses on social inclusion and climate resilience. Developed with indigenous networks, it prioritizes indigenous cultural heritage while promoting ecotourism and sustainable agriculture.
The initiative emphasizes transparent resource distribution and collaborative governance among Indigenous territories, regional stakeholders, and the World Bank.
Farlin Telles Ríos from ADITICA remarks: “For me, the project is important because it allowed us to develop infrastructure in the communities.”
Through investment in carbon finance, Costa Rica demonstrates that forest protection can align with economic resilience and sustainability—serving as a model for other countries.