Wednesday, December 10, 2008

Costa Rica Carbon Neutral by 2021

Costa Rica aims to be fully carbon neutral by 2021 when it celebrates 200 years of independance.

The strategy will build on Costa Rica’s decision to tax fossil fuels in 1996 with the money raised allocated to the National Forestry Financing Fund. This 3.5% tax on gasoline in the country is used for payments to compensate landowners for growing trees and protecting forests and its government is making further plans for reducing emissions from transport, farming and industry.

These are part of a ‘payment for environmental services’ programme that pays landowners who manage forests for their carbon sequestration and storage alongside management for water production, biodiversity and scenic beauty.

In 2007 Costa Rica planted more than five million trees or 1.25 per person making it the highest per capita planting in the world. Various industries are supporting the initiative including a C-neutral plan by Costa Rica’s banana sector.

Other elements of the strategy include increasing the percentage of renewable energy generation to well over 90 per cent and action on energy efficiency including energy saving appliances. In 2004, 46.7% of Costa Rica's primary energy came from renewable sources while 94% of its electricity was generated from hydroelectric power, wind farms and geothermal energy in 2006.

What does mean for investors in land in Costa Rica?

Costa Rica's plans to become carbon neutral will require the encouragement of exiisting initiatives and a range of further initiatives.

Those initiatives include incentivising the further planting of trees and further preservation of land. These incentives will, by definition, reduce the amount of developable land. This in turn will push up land prices.

From a macroeconomic standpoint there has never been a better time to invest in development land in Costa Rica.

Combine a development land investment with the security of teak growing on your land and you have the "perfect investment".

To see more about this opportunity to invest in land and teak in Costa Rica call us on +353 1 272 4184, e mail us or have a look at our website

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