Capital Enhancement for Sustainable Development through the Environmental Bank Foundation (FUNBAM)

Costa Rica recognizes agriculture as a key source of emissions, but the question is on how to increase necessary capital for the associated AFOLU (agriculture, forestry, and other land uses) sector to implement NDC strategies and achieve targets, given the fiscal deficit of the government. In this context, the Government intends to transform FUNBAM into a specialized financing entity for ecosystem management and has requested GGGI to utilize its skills in designing, restructuring and scaling up the vehicle. The overall problems that the project is seeking to address are as follows: Lack of capital for the government to achieve the targets in their NDCs. Lagged local market for sustainably produced agriculture/ forestry products (e.g. timber) distorted by scattered and skewed information without a central governing body and the system. Reluctance to change current land-use practices due to financial instability during the conversion period caused by upfront capital, lack of knowledge/technical assistance; and limited access to markets with price premiums