Indonesia Targets US$5.8 Bln Green Investment Through Carbon Market
By Nik Nurfaqih Nik Wil
JAKARTA, July 6 (Bernama) -- Indonesia's Carbon Economic Value (NEK) instrument is projected to attract up to US$5.8 billion (US$1=RM4.08) in green investment while reducing greenhouse gas emissions by an estimated 570 million tonnes of carbon dioxide (CO2) equivalent.
Coordinating Minister for Food Affairs Zulkifli Hasan said innovative financing is needed to support climate action, with the NEK instrument projected to drive green investment while contributing to the country's emissions reduction efforts.
“Therefore, climate change mitigation is not merely an environmental agenda. It is an agenda for economic resilience, food security and the future sovereignty of our nation,” he said in his remarks at the launching ceremony of the Indonesia Forestry Carbon Centre, here, on Monday.
Zulkifli said climate action currently accounts for an average of only 3.5 per cent of Indonesia's annual state budget, with just 0.7 per cent allocated to forest rehabilitation and conservation, underscoring the need for innovative financing mechanisms beyond public funding.
He said one of the government's main targets is the launch of the Carbon Unit Registration System (SERUK) on July 9, which he described as the backbone of the republic's carbon infrastructure.
Meanwhile, Presidential Special Envoy for Energy and Climate Hashim Djojohadikusumo said the government has identified 12.7 million hectares of degraded forest for rehabilitation over the coming years under a programme initiated by President Prabowo Subianto.
He said the rehabilitation programme could become another source of carbon market projects, with investors invited to finance the restoration of degraded forests in return for earning carbon credits through Indonesia's carbon trading mechanism.
“Investors are welcome to invest in the reconstruction and rehabilitation of 12.7 million hectares and, in return for their investment, will be eligible to receive carbon credits through the carbon mechanisms available today," he said in his speech at the same event.
-- BERNAMA