Catalysing the Low Carbon Transition and Electric Mobility Development Through National Bank of Costa Rica

Introduction

Costa Rica has set out to implement a very ambitious National Plan for Decarbonization 2018-2050. The European Union is partnering with AFD and the National Bank of Costa Rica to assist the country in achieving its carbon neutrality objectives.

Objectives

This project aims at catalysing the financing of the low carbon transition in Costa Rica mobilising the banking sector.  It promotes investments and key infrastructures in priority areas for sustainable socio-economic development including SMEs, private sector development, e-mobility, energy, water and general environmental protection with a focus on climate change mitigation and adaptation.

More specifically, the project will support electric mobility schemes though  dedicated technical assistance.  This is critical for reducing Costa Rica’s emissions as the transport sector is the main source of CO2 emission in the country.

Project activities

The project is divided into two components:

1. A non-sovereign credit line to finance climate mitigation and adaptation investments in Costa Rica.

2. A Technical Assistance Facility to: 

• Support a dedicated climate strategy  for the National Bank of Costa Rica inspired by best international practices and adapted to the specificities of climate finance in Costa Rica;
• Improve social risk management systems and gender policies within the bank;
• Provide customised  support to climate investors and improve climate-related banking products (e-vehicles financing offers, green housing finance, etc.);
• Help transport clients (mainly bus operators) structure and develop their e-vehicles purchase and operation projects.

Results

This project will achieve the following results:

• The emergence of a structured climate finance ecosystem in Costa Rica, providing long-term credit for climate investments;
• The provision of technical support to the National Bank of Costa Rica to adopt climate-related solutions and implement a climate-resilient strategy;
• The contribution to Costa Rica’s neutral carbon objective and an improvement of air quality;
• An improvement of the country’s resilience to climate change.

Implementing partner

Agence Française de Développement (AFD)