- Agroforestry systems
- Silvopastoral systems
- Forest plantations of exotic and native species
Law No. 822 – Taxation Agreement Law (Chapter IX contains Fiscal Benefits for t…
Law No. 382 – Temporary Admission Law (regulates duties/taxes for certain goods)
Law No. 917 – Free Trade Zone Law (general exemptions for businesses)
Nicaragua’s location in Central America makes it highly susceptible to the effects of climate change, and according to CAIT (2015), 67% of the nation’s 2012 GHG emissions were generated by land use change. As a result, adaptation and mitigation of these effects has become a national priority. Furthermore, Nicaragua is an important biodiversity hotspot central to the Mesoamerican Biological Corridor that has significant conservation importance.
To adapt to and mitigate climate change and preserve the nation's natural areas and services, Nicaragua joined Initiative 20x20 in 2015. Nicaragua's Agency for Investment Promotion (PRONicaragua) joined the Initiative with the goal of restoring nearly 2.8 million hectares to:
- Manage watersheds
- Improve resilience of rural livelihoods to the effects of climate change
- Conserve biodiversity
The 2.8 million hectares pledged are distributed in the following way:
- 1,666,082 ha for productive reforestation
- 138,820 ha for forest plantations for ecosystem services
- 277,680 ha for implementation of forestry business
- 416,520 ha for wood product plantations
- 555,361 ha for agroforestry
- 277,680 ha for plantations for sustainable agricultural business
- 1,110,721 ha of reclamation of lands degraded by erosion, soil compaction, contamination by agrochemicals, or overgrazing
In the first “preparation” phase of Nicaragua’s restoration process (2012-2017) Nicaragua began with $3.8 million USD allocated from the World Bank’s Forest Carbon Partnership Facility (FCPF). In September 2016 FCPF granted Nicaragua’s National Program for Avoided Deforestation (ENDE-REDD+) an additional $5 million USD to continue preparing to reduce deforestation and forest degradation.
The second “payments for results” phase of the restoration process (2018-2022) will seek further private and public funds to reach total $55 million USD of payments for avoided deforestation and degradation.
Nicaragua also utilizes incentives such as tax benefits and exemptions to attract investors, though most are not specific to forestry businesses.