Costa Rica is set to publish its sustainable finance taxonomy on 14 August, a key development in the country’s effort to enhance the local sustainable finance market.
According to Environmental Finance, this comes after a comprehensive consultation process, concluding just over two months ago, which sought to finalise the ‘green’ guidelines for the South American nation.
Deputy minister of expenditures Luis Antonio Molina Chacón expressed optimism about the forthcoming publication, highlighting its potential to catalyse private sector growth in environmentally sustainable investments. “This taxonomy is a significant step forward for Costa Rica,” Molina Chacón said, “as it provides a clear framework for the private sector to contribute more effectively to our sustainability goals.”
Initiated in April 2023 with the backing of the Green Climate Fund (GCF), EU, and UN, the Costa Rican taxonomy aligns with international standards, such as the ‘Common Framework of Sustainable Finance Taxonomies for Latin America and the Caribbean’ published by the UN Environment Programme in 2023. This alignment underscores Costa Rica’s commitment to global sustainability practices and its collaborative approach to environmental challenges.
The taxonomy identifies eight critical sectors for sustainable investment, including construction, transport, energy, solid waste management, drinking water and sanitation, ICT, manufacturing, and agriculture. Each sector has specified science-based criteria to ensure that activities are not only environmentally sustainable but also contribute to climate mitigation and adaptation efforts.
The publication of Costa Rica’s taxonomy follows a regional trend, with other Latin American countries like Colombia, Mexico, and Panama also developing their own frameworks in recent years. This regional momentum highlights a growing recognition of the importance of structured financial strategies in tackling climate change and supporting sustainable development.
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