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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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Assessment and policy recommendations

This Review, undertaken in close co-operation with the Costa Rican Executive Secretariat for Agricultural Sector Planning (SEPSA) and other institutions of the Agricultural Public Sector (APS), assesses the performance of the agricultural sector in Costa Rica over the last two decades, evaluates the country’s agricultural policy reforms, and provides recommendations to address future challenges faced by the sector. The evaluation is based on the OECD Committee for Agriculture’s approach that agricultural policy should be evidence-based and carefully designed and implemented to support productivity, competitiveness and sustainability, while avoiding unnecessary distortions to production decisions and to trade. The Review also includes a special chapter highlighting recent advancements and key challenges related to the adaptive capacity of agriculture to climate change.

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