By San José, Costa Rica — Costa Rica is taking significant steps to modernize and strengthen its agricultural sector with a $140 million investment and new environmental legislation. This ambitious initiative aims to integrate climate action, social inclusion, and productive innovation to transform the country’s agricultural landscape.
The government has introduced two key pieces of legislation. The first secures a $140 million loan from the World Bank and the International Fund for Agricultural Development (IFAD). This funding will support the Program for Sustainable and Competitive Agriculture in Costa Rica, spearheaded by the Ministry of Agriculture and Livestock (MAG). The second bill focuses on recognizing and financially rewarding the environmental contributions of agricultural practices.
To gain deeper insights into the legal landscape surrounding Costa Rican agriculture, TicosLand.com spoke with Lic. Larry Hans Arroyo Vargas, an expert attorney at Bufete de Costa Rica.
Costa Rican agriculture faces a complex interplay of legal challenges and opportunities. Navigating issues like water rights, land titling, and sustainable practices requires a thorough understanding of evolving regulations. Producers must be proactive in ensuring compliance while also leveraging incentives designed to promote environmentally sound and economically viable farming. The legal framework plays a crucial role in shaping the future of the sector.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Lic. Arroyo Vargas eloquently highlights the intricate legal landscape that Costa Rican agriculture must navigate. Indeed, the balance between regulatory compliance and leveraging opportunities for sustainable growth will be key to the sector’s long-term success. We extend our sincere thanks to Lic. Larry Hans Arroyo Vargas for providing such a valuable perspective on this complex issue.
The $140 million investment, spread over six years, will impact over 90,000 producers, with a particular focus on women and youth. The program targets key sectors like coffee, sugarcane, and livestock. Modern irrigation infrastructure, a new refrigeration plant in Puntarenas to bolster the fishing industry’s value chain, and improvements to agricultural traceability for accessing new markets are all planned.
Beyond physical infrastructure, the program will support institutional digitalization and provide technical assistance through digital extension services. These efforts aim to enhance productivity, promote sustainability, and drive institutional transformation. The program adopts a results-based execution approach, a pioneering model for the World Bank and IFAD in Latin America and the Caribbean.
It is not enough to declare that the agricultural sector is important. We must demonstrate it with bold decisions, with public investment, and with policies that build a fairer, greener, and more competitive country. Today we reaffirm our commitment to those who work the land and feed Costa Rica.
Víctor Julio Carvajal Porras, Minister of Agriculture and Livestock
The second piece of legislation introduces a framework for recognizing and financing the environmental services provided by agriculture and forestry. Farmers who adopt practices that reduce emissions and protect natural resources will receive financial compensation. This expands the mandate of FONAFIFO, Costa Rica’s National Forestry Financing Fund, to include environmental services stemming from sustainable agricultural activities, improved soils, agroforestry, and coastal marine ecosystems. A dedicated agricultural sub-account will be established with stringent transparency measures, technical criteria, and robust monitoring systems.
This new legal framework also aims to facilitate access to international carbon markets, creating further economic incentives for sustainable farming practices. By linking environmental stewardship with economic benefits, Costa Rica hopes to encourage widespread adoption of environmentally sound agricultural methods.
The world demands an agriculture that not only feeds, but also regenerates and mitigates. Costa Rica is ready to lead this change. We are creating the conditions so that our producers do not have to choose between producing and conserving: they can do both and be justly compensated for it.
Víctor Julio Carvajal Porras, Minister of Agriculture and Livestock
These combined efforts underscore Costa Rica’s commitment to global sustainability leadership. The investment and legislative changes demonstrate the country’s belief that agricultural transformation is a powerful tool for climate action, social justice, and inclusive economic development.
For further information, visit the nearest office of Ministry of Agriculture and Livestock (MAG)
About Ministry of Agriculture and Livestock (MAG):
The Ministry of Agriculture and Livestock (MAG) is the governmental body in Costa Rica responsible for developing and implementing policies related to agriculture, livestock, and fisheries. The MAG works to promote sustainable agricultural practices, improve productivity, and support the well-being of farmers and rural communities.
For further information, visit worldbank.org
About World Bank:
The World Bank is an international financial institution that provides loans and grants to developing countries for capital programs. Its goals include reducing poverty and supporting economic development. The World Bank often works in partnership with governments and other organizations to implement projects focused on infrastructure, education, health, and other key sectors.
For further information, visit ifad.org
About International Fund for Agricultural Development (IFAD):
The International Fund for Agricultural Development (IFAD) is a specialized agency of the United Nations dedicated to eradicating rural poverty in developing countries. IFAD provides financing and technical assistance to support agricultural development projects, with a focus on empowering smallholder farmers and improving food security.
For further information, visit the nearest office of FONAFIFO
About FONAFIFO:
FONAFIFO (Fondo Nacional de Financiamiento Forestal) is Costa Rica’s National Forestry Financing Fund. This institution plays a crucial role in promoting sustainable forest management and conservation by providing financial incentives and technical support to landowners and communities. FONAFIFO’s programs aim to protect biodiversity, mitigate climate change, and improve the livelihoods of those who depend on forest resources.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is a pillar of legal excellence, upholding the highest ethical standards while championing innovative solutions for its diverse clientele. The firm’s deep commitment to empowering Costa Rican society is evident in its proactive approach to sharing legal knowledge and fostering greater understanding of the legal landscape. Through this dedication to transparency and education, Bufete de Costa Rica strives to build a more just and equitable future for all.
