The principal aim of the OECD Environmental Performance Review programme is to help member and selected partner countries improve their individual and collective performance in environmental management by:

Signs

Costa Rica is globally known as a green country and ecotourism destination. It should be commended for reversing deforestation, producing all of its electricity from renewables and committing to net zero by 2050. The country has made some progress in delinking environmental pressures from its economic growth over the last decade. However, energy use and related greenhouse gas (GHG) emissions rose. Air quality is of concern in major urban areas. Increasing population, urbanisation and tourism have strained the undersized water, waste and transport infrastructure and services. Pressures on the environment are likely to grow with rising living standards and climate change.

The Assessment and Recommendations present the main findings of the OECD Environmental Performance Review of Costa Rica. They identify 52 recommendations to help the country make further progress towards its environmental objectives and international commitments. The OECD Working Party on Environmental Performance discussed and approved the Assessment and Recommendations on 12 May 2023.

Costa Rica made important strides in delinking environmental pressures from its fast economic growth in the last 15 years. It has expanded forest cover and electricity generation from renewable sources. However, cars are a growing source of emissions of greenhouse gases and air pollutants. Waste disposal still relies on landfills, and much wastewater is untreated. Pressures on the environment are likely to increase with sustained economic growth and rising living standards. This chapter provides an overview of Costa Rica’s environmental achievements since 2010, and its remaining challenges. It reviews progress in moving towards a low-carbon and climate-resilient economy, controlling air pollution, ensuring sound waste services and improving management of water resources.

Sustainable development and green growth are high on Costa Rica’s agenda. The country has a long-standing environmental policy, a comprehensive legal framework and well-developed mechanisms of environmental democracy. However, institutional capacity and financial resource constraints have hampered effective implementation. The sheer scale of investment needed to achieve the Sustainable Development Goals calls for improving the efficiency of public spending, mobilising private finance, strictly enforcing regulations and providing adequate incentives. This chapter assesses the environmental effectiveness and economic efficiency of the environmental governance and policy mix, including regulatory, fiscal and economic instruments. It also looks at efforts to increase investment in environment-related infrastructure and services and encourage green business practices.

A megadiverse country, Costa Rica is known globally for its success in reversing deforestation. The country’s extensive protected area network and pioneering programme of payments for ecosystem services have helped reduce biodiversity loss and extend forests’ carbon sequestration capacity. However, more should be done to tackle pressures on biodiversity from development of infrastructure and settlements, tourism, farming and fishing. This chapter discusses Costa Rica’s progress in preserving its rich ecosystems and species. It reviews the legal, strategic and institutional framework, as well as the policy and financing instruments for biodiversity conservation and sustainable use. Finally, this chapter assesses how biodiversity considerations have been mainstreamed into tourism, agriculture and fishing policies.