On our vacation in January, we visited Costa Rica. I’d never thought much about the country before—in fact, I’m not sure I could have pinpointed exactly where in Latin America it was. But what I discovered really impressed me. Costa Rica is one of the most environmentally conscious countries in the world, and for good reason: the tiny country contains 4% of the total species estimated worldwide. It’s at the top of the 2010 Happy Planet Index, measuring a combination of well-being and environmental impact; fifth on the 2008 Environmental Performance Index; and winner of the 2010 Future Policy Award. The government’s goal is for Costa Rica to become the first carbon-neutral country by 2021.

Costa Ricans report the highest life satisfaction in the world. I’m trying to bring their concept of pura vida back home.

Things weren’t always this bright. From 1940 to 1987, forest cover dropped from 75% to only 21%. But that number has increased to 52% by 2005 thanks to a series of environmental laws. More than 25% of the country is now national preserve, a 1996 law restricted forest clearing, and a payment for ecosystem services (PSA) program has encouraged landowners not to clear their forested land. The PSA has been held up as a model for other countries, with 30% of its payments going to the extremely poor.

Ecotourism is now the largest employer in the country, constituting a higher percentage of GDP than the three largest cash crops: pineapples, bananas, and coffee. This is important, in that it shows that preserving natural resources does lead to financial benefits. However, it’s also important that the economy isn’t completely reliant on tourism. Electronic components and medical equipment manufacturing each pull in more money than tourism each year.

The picture’s not all rosy: There’s some question as to how effective the PSA program by itself has been; poaching is still a problem in national preserves; and the focus on deforestation has neglected some other environmental issues, such as air and water pollution. But the government has shown that it’s committed to environmental issues and that it’s possible to grow economically while still protecting natural resources.