Books
Abstract
Developing countries around the world face the dual challenge of speeding up economic growth and slowing down environmental degradation, two objectives that are perceived to be in direct conflict. The chapters in this volume demonstrate for Central America how economic and environmental policies can be coordinated and integrated to advance both sustainability and competitiveness in the region. Using comprehensive surveys, statistical analysis and micro and macro modeling, the authors demonstrate that Central America''s competitive future and development potential are inextricably linked to its natural environment. This is shown to be true not only in the negative sense of minimizing the damage to the natural resource base and mitigating the impact of natural disasters, but also in the positive sense of making the region more attractive to foreign investors, aligning the agricultural and tourist sectors with more lucrative markets, and exploiting the emerging markets in environmental services and "green" trade.
The studies on deforestation recommend policies to raise the financial value of the standing forests more in line with its true economic value through ecotourism and through the pricing and marketing of local and global environmental services. The studies on agriculture recommend protection of property rights, control of agricultural externalities and shift of resources from traditional to organic crops for export, and competition on costs rather than price. The studies on tourism advocate a better matching between demand and supply, greater complementarity between on-site services and infrastructure, and congestion pricing and the development and marketing of a regional tourist product. Tapping the emerging international markets for environmental services, whether for carbon sequestration or biodiversity, holds great potential for Central America, a region of special ecological significance for the entire American continent. The region can extract advantageous trade terms in hemispheric trade negotiations by utilizing its "environmental card", i.e. its capacity to deliver environmental goods and services in the form of biodiversity conservation, carbon sequestration and sustainable tourism. In this regard, tightening environmental regulations in Central America is shown not to discourage investment but to help maintain competitiveness in the agricultural and tourist sectors.
