Costa Rica Launches Sustainable Project Preparation Facility at COP28

Dubai, In a significant move to enhance its climate resilience, the Government of Costa Rica has announced the establishment of a Public-Private Partnership (PPP) Project Preparation Facility (PPF) at the COP28 summit in Dubai. This facility aims to develop sustainable and efficient infrastructure projects by leveraging both public and private sector resources.

According to International Monetary Fund, this initiative is part of the Resilience and Sustainability Facility (RSF) arrangement, which was approved by the IMF’s Executive Board in November 2022. The RSF, amounting to US$ 725 million at the time of approval, supports Costa Rica’s efforts in integrating climate risks into fiscal planning and strengthening infrastructure resilience to climate change.

The PPF, coordinated by the Inter-American Development Bank (IDB) in partnership with the Costa Rican Government, will follow international best practices for sustainable project preparation. It will draw on IDB's expertise in setting up similar facilities in the region and will build upon its technical assistance to Costa Rica. The facility will provide financial and technical support to create capacity and technical expertise in the country, focusing on four key areas: regulatory and institutional reforms, project identification and prioritization, project structuring, and private sector support.

The European Investment Bank (EIB) has also announced the creation of a regional financing facility to support sustainability-related projects, expecting to crowd-in additional resources for climate and environmental initiatives. This facility will work in coordination with the European Union (EU) Delegation in Costa Rica and other partners.

Furthermore, the World Bank (WB) is actively supporting climate finance in Costa Rica, including disaster risk management and climate adaptation activities. The WB has agreed to provide technical assistance for green bond issuance and financing to reduce emissions from deforestation and forest degradation (REDD+).

The World Bank Group’s International Finance Corporation (IFC) is contributing to Costa Rica’s climate resilience by developing a green taxonomy at the regional level and supporting sustainable modernization initiatives, such as the expansion of Puerto Caldera and the transformation of the agribusiness sector.

Costa Rica is also developing a sovereign thematic bond strategy with the UNDP to support its climate goals. This strategy involves issuing sovereign bonds that reflect the country's climate and social credentials and is linked to its Sustainable Development Goals (SDGs) and Nationally Determined Contribution (NDC).

These collaborative efforts are part of Costa Rica’s comprehensive strategy to promote inclusive and sustainable growth and reinforce its role as a global leader in the climate agenda. These initiatives are supported by various international organizations, including the IMF, IDB, EIB, WB, and UNDP.

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