Costa Rica has proved that linking conservation to market forces is an effective model for long-term economic growth and particularly rural development. Having realized the enormous financial potential of its forests and natural areas through ecotourism the country has now begun to introduce further innovative mechanisms and incentives to encourage preservation and generate development income.
The most prominent and ground-breaking of these has been the ‘Payment for Environmental Services’ (PSA) program, introduced in 1996 as part of an amendment to the forestry law.
Under this system the value of environmental services provided by forested areas is recognized and landowners are duly compensated for the benefits provided to society as a whole by the maintenance of these lands. The program identifies four resources Costa Rican’s now pay to protect; the provision of fresh water for consumption and hydro-electrical purposes; the mitigation of greenhouse gases; the protection of biodiversity for research and the preservation of scenic beauty, particularly for tourism.
The program is funded primarily through a special fuel or ‘eco’ tax, applied to the consumption of any crude-oil derivatives. Financing also comes from contracts with hydro-electrical companies, from ‘Environmental Services Certificates’, issued for voluntary contributions from the private sector and from international grants offered by the World Bank and the Global Environment Facility.
The system has proved fundamental in reversing the deforestation trend and has become a force for social gain and poverty alleviation with indigenous and rural village communities becoming the main beneficiaries of the payments. Between 2000 and 2005 indigenous participation in the system rose more than 100% and female farm ownership grew from 200 to 1600 farms. In 2005 almost $60 million in PSA payments went to rural landowners. The government is now planning to expand the scheme to tax those who benefit most from protected lands – ecotourism operators.
Other revolutionary strategies through which Costa Rica has sought to support this model of economic development within a framework of biological sustainability include the implementation of a ‘Certification for Sustainable Tourism’ program. Through this hotels and tour operators are awarded a rating on a scale of 0-5, not unlike the familiar star system, according to the degree to which their operations comply to a model of sustainability, allowing them to differentiate themselves within the ecotourism market and also working to counteract the problem of ‘greenwashing’ – attaching a ‘green’ label to services which do not classify as eco-friendly.
In 2005 the country was party to a ‘Compensation for Emissions’ deal drawn up at the UN Summit on Climate Change in Montreal, calling for wealthy nations to compensate poor countries for rainforest conservation, and Costa Rica is already a major beneficiary of the Joint Implementation Mechanism created by the Climatic Change Agreement to reduce greenhouse gases, a percentage of which goes to fund PSA payments.
Finally, the most recent activity to become part of this integrated conservation-development model is research into biodiversity.
This occurs primarily through what is known as ‘biodiversity prospecting’ or ‘bio-prospection’ – using forests for research into ‘new sources of chemical compounds, genes, proteins, micro-organisms and other elements that possess real or potential economic value’, 9 undertaken by pharmaceutical, biotechnology, cosmetics and agro-industrial organizations.
INBIO, the National Biodiversity Institute, has been a pioneer in this field. Established in 1989, INBIO is a non-governmental, non-profit organization that aims to ‘gather knowledge on the country’s biodiversity and promote its sustainable use’, believing that the long-term protection of natural resources depends on understanding as much as possible about what exists and ‘putting that knowledge to work for the future improvement of society’. 10
To date this has included employing and training local people, through its ‘Parataxonomist Program’, to create a huge inventory ‘identifying and cataloguing every living thing in the country’ and using the information generated in decision and policy making processes at all levels. The local parataxonomists also pass on awareness of the value of biodiversity to their own communities through educational programs aimed at colleagues, neighbors and local schools, as part of the Institute’s conscious drive to integrate its activities with the empowerment, development and participation of local communities. Most importantly, in economic growth terms at least, it has meant signing biodiversity research contracts with various transnational companies and foreign universities seeking to use the information for ‘bio-prospection’ purposes.
Through these contracts INBIO receives research funding as well as a fifty percent royalty on any patentable products or compounds developed, all of which is invested into conservation and social development projects throughout Costa Rica.
Under this system the value of environmental services provided by forested areas is recognized and landowners are duly compensated for the benefits provided to society as a whole by the maintenance of these lands. The program identifies four resources Costa Rican’s now pay to protect; the provision of fresh water for consumption and hydro-electrical purposes; the mitigation of greenhouse gases; the protection of biodiversity for research and the preservation of scenic beauty, particularly for tourism.
The program is funded primarily through a special fuel or ‘eco’ tax, applied to the consumption of any crude-oil derivatives. Financing also comes from contracts with hydro-electrical companies, from ‘Environmental Services Certificates’, issued for voluntary contributions from the private sector and from international grants offered by the World Bank and the Global Environment Facility.
The system has proved fundamental in reversing the deforestation trend and has become a force for social gain and poverty alleviation with indigenous and rural village communities becoming the main beneficiaries of the payments. Between 2000 and 2005 indigenous participation in the system rose more than 100% and female farm ownership grew from 200 to 1600 farms. In 2005 almost $60 million in PSA payments went to rural landowners. The government is now planning to expand the scheme to tax those who benefit most from protected lands – ecotourism operators.
Other revolutionary strategies through which Costa Rica has sought to support this model of economic development within a framework of biological sustainability include the implementation of a ‘Certification for Sustainable Tourism’ program. Through this hotels and tour operators are awarded a rating on a scale of 0-5, not unlike the familiar star system, according to the degree to which their operations comply to a model of sustainability, allowing them to differentiate themselves within the ecotourism market and also working to counteract the problem of ‘greenwashing’ – attaching a ‘green’ label to services which do not classify as eco-friendly.
In 2005 the country was party to a ‘Compensation for Emissions’ deal drawn up at the UN Summit on Climate Change in Montreal, calling for wealthy nations to compensate poor countries for rainforest conservation, and Costa Rica is already a major beneficiary of the Joint Implementation Mechanism created by the Climatic Change Agreement to reduce greenhouse gases, a percentage of which goes to fund PSA payments.
Finally, the most recent activity to become part of this integrated conservation-development model is research into biodiversity.
This occurs primarily through what is known as ‘biodiversity prospecting’ or ‘bio-prospection’ – using forests for research into ‘new sources of chemical compounds, genes, proteins, micro-organisms and other elements that possess real or potential economic value’, 9 undertaken by pharmaceutical, biotechnology, cosmetics and agro-industrial organizations.
INBIO, the National Biodiversity Institute, has been a pioneer in this field. Established in 1989, INBIO is a non-governmental, non-profit organization that aims to ‘gather knowledge on the country’s biodiversity and promote its sustainable use’, believing that the long-term protection of natural resources depends on understanding as much as possible about what exists and ‘putting that knowledge to work for the future improvement of society’. 10
To date this has included employing and training local people, through its ‘Parataxonomist Program’, to create a huge inventory ‘identifying and cataloguing every living thing in the country’ and using the information generated in decision and policy making processes at all levels. The local parataxonomists also pass on awareness of the value of biodiversity to their own communities through educational programs aimed at colleagues, neighbors and local schools, as part of the Institute’s conscious drive to integrate its activities with the empowerment, development and participation of local communities. Most importantly, in economic growth terms at least, it has meant signing biodiversity research contracts with various transnational companies and foreign universities seeking to use the information for ‘bio-prospection’ purposes.
Through these contracts INBIO receives research funding as well as a fifty percent royalty on any patentable products or compounds developed, all of which is invested into conservation and social development projects throughout Costa Rica.
