G LOBAL T RADE FOR L OCAL B ENEFIT: F INANCING E NERGY FOR A LL IN C OSTA R ICA RENÉ CASTRO AND SARAH CORDERO First movers often have an advantage. But when it comes to the environment, late- comers sometimes enjoy an advantage as well. To illustrate this counterintuitive proposition, this chapter examines one of Costa Rica’s policy goals—clean, sus- tainable electricity for all its citizens—through the lens of global public goods. 1 The global public goods perspective is logical for people and policymakers in Costa Rica. Like other Central American countries, Costa Rica is acutely aware of the risks that global warming would entail for the region. Many viewed recent experiences with El Niño as serious warning signs. Costa Rica is rich in natural resources, such as forests, that are sought-after commodities around the world. But Costa Rica, again like many other countries, does not want to pursue eco- nomic growth and development at the expense of the atmosphere. Thus economic growth and poverty reduction—and with them, electricity for all—must be achieved through a comprehensive strategy that relies on renewable, nonpollut- ing energy sources. Climate stability is important for the lives of Costa Ricans and is a major national policy concern—but one with global dimensions. In a way Costa Rica’s people and policymakers are fortunate to face the dual challenge of providing electricity for all in an environmentally sound way. The reason is that this chal- lenge provides incentives to engage with other countries both to secure financing and to pursue an approach that is globally sustainable. Costa Rica also benefits from being a latecomer in fossil fuel consumption, because its “lagging” position will allow it to be among the first movers in carbon emissions trading. Carbon trading is not yet a reality, however, because global climate stability and a clean atmosphere are global public goods that follow a summation production process: all actors, public and private, will have to cooperate for these goods to emerge— creating demand for the natural resources and environmental services that Costa Rica has to offer. 516