World Bank Approves $120M for Costa Rica to Empower Small Farmers and Promote Sustainable Agriculture

The investment supports the implementation of the Public Policy for the Agricultural Sector 2023–2032, a long-term strategy that envisions a greener, more competitive agricultural economy.

Costa Rica has taken a major step forward in transforming its agricultural landscape with the approval of a $120 million investment by the World Bank. The newly launched Program for Sustainable and Competitive Agriculture aims to foster environmental sustainability, bolster competitiveness, and enhance the economic participation of small and medium agricultural producers (known locally as PYMPAs). With a structured focus on modernizing agricultural systems, improving market access, and reinforcing climate resilience, this ambitious initiative is expected to benefit tens of thousands of rural families across the country.

Direct Support to Over 30,000 Agricultural Producers

The program is designed to directly benefit approximately 10,500 PYMPAs and their families, reaching an estimated total of 31,500 individuals. Among these, around 30% are women and 15% are young people, ensuring that gender and generational equity are embedded in the project’s execution. Moreover, the program anticipates providing digital registration for another 30,000 producers, vastly expanding the reach and impact of modern agricultural tools and services.

“This project is a crucial step towards the sustainable development of our rural and most vulnerable communities. With the support of the World Bank, we will improve agricultural productivity and strengthen climate resilience, significantly contributing to the well-being of our farmers and their families,” said Nogui Acosta Jaén, Costa Rica's Minister of Finance.

Driving Agricultural Transformation through Public Policy

The investment supports the implementation of the Public Policy for the Agricultural Sector 2023–2032, a long-term strategy that envisions a greener, more competitive agricultural economy. It marks a fundamental shift toward a Program for Results (PforR) model — where funds are disbursed based on the achievement of specific results rather than input-based financing. This outcome-driven framework ensures greater accountability and a tighter alignment between funding and on-the-ground improvements.

Víctor Julio Carvajal Porras, Minister of Agriculture and Livestock, emphasized the significance of the approach: “This credit is a vital support for the transformation of the Costa Rican agricultural sector, by financing specific actions within public policy that drive its evolution towards a more resilient and competitive model.”

Four Pillars of Transformation

The program is anchored on four interconnected strategic pillars:

1. Institutional Modernization A nationwide digital registration system will be deployed to track agricultural, livestock, aquaculture, and fishing activities. This digital transformation will streamline information management, increase transparency, and enhance producers’ access to technical support and government services.

2. Boosting Competitiveness and Market Access The creation of a national product traceability system will enable producers to document the origin and quality of their goods — a critical step for obtaining certifications that open doors to both national and international markets. Additionally, the expansion of the National Refrigeration Network in the Central Pacific will provide fishermen with better storage and distribution infrastructure. The program will also promote the use of bio-inputs as sustainable alternatives to traditional agrochemicals.

3. Sustainable and Resilient Production Recognizing the existential threat posed by climate change, the third pillar centers on promoting sustainable agricultural practices. This includes diversification of climate-resilient crops, adoption of efficient irrigation systems, improvement in livestock health and hygiene standards, and reduction in greenhouse gas emissions.

4. Environmental Incentives through Carbon Credits Producers engaging in sustainable practices will receive financial incentives tied to environmental benefits — particularly carbon capture. Sectors such as coffee, livestock, and sugarcane will be rewarded for adopting low-emission farming methods and contributing to national climate goals.

A Milestone in World Bank–Costa Rica Collaboration

The approval of this operation not only reflects Costa Rica’s commitment to agricultural innovation and inclusivity but also underscores the strength of its long-standing partnership with the World Bank.

“This new financing is a testament to the long-term commitment and collaboration between the World Bank and the government of Costa Rica,” said Carine Clert, World Bank Country Manager for El Salvador and Costa Rica. “Together, we contribute to enabling Costa Rican farmers, both women and men, to adopt sustainable agricultural practices and access national and international markets, fostering the country's economic and social development.”

Long-Term Impacts

The broader implications of the program extend beyond increased productivity and market competitiveness. By aligning public policy with tangible sustainability outcomes, Costa Rica sets a precedent in Latin America for how to balance economic growth with environmental stewardship and social equity. If successful, the model may serve as a blueprint for similar economies striving to empower rural populations while addressing climate imperatives.