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Agricultural Policies in Costa Rica

image of Agricultural Policies in Costa Rica

Costa Rica’s strong agricultural sector is underpinned by the country’s political stability, robust economic growth and high levels of human development.  The sector has achieved significant export success, yet raising productivity and staying competitive in world markets will require efforts to address bottlenecks in infrastructure, innovation and access to financial services.  Maximising Costa Rica’s comparative advantage in higher-value niche products will depend upon more efficient services to agriculture, including better implementation of programmes, improved co-ordination among institutions, and reduced bureaucracy. While overall protection for agriculture is relatively low compared to OECD countries, it is nonetheless highly distorting to production and trade. Managing the transition to scheduled liberalisation presents an opportunity to reform costly policies, and to implement an alternative policy package with new investments in innovation, productivity and diversification, supported by transition assistance where needed. Costa Rican agriculture’s vulnerability to extreme weather events is expected to worsen with climate change, and even while the country is among global leaders in environmental protection, sustainable development and climate change mitigation, further adaptation efforts will be necessary.

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Adaptation to climate change in Costa Rica's agricultural sector

The long-term productivity of Costa Rica’s agricultural sector is at serious risk from climate change. Increasingly severe floods and droughts, rising temperatures and heightened exposure to pests all threaten to compromise the sustainability of its productivity growth in the coming decades. This chapter assesses efforts by the Costa Rican government to encourage farmers to adapt to climate change. Adaptation is key to minimising the negative effects and taking advantage of new opportunities in a changing climate. The government has already taken a number of important steps to support farmer efforts to adapt. This chapter highlights progress made, and discusses opportunities to take this further through four key dimensions of adaptation policy: (i) strategic prioritisation of adaptation objectives, (ii) information generation and dissemination, (iii) rule-based regulation, and (iv) financial incentives.

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