Indonesia Committed To Reduce 29 Per Cent of Greenhouse Emissions By 2030

KUALA LUMPUR, Dec 7 (Bernama) -- Indonesia is committed to reduce greenhouse gas emissions by 29 per cent on its own effort and 41 per cent with international support by 2030. Indonesia's Finance Minister Dr Sri Mulyani Indrawati said her ministry has been committed to support funding of this effort in line with the integration of Indonesia's Low Carbon Development Policy to the Medium Term National Development Plan, National Action Plan for Greenhouse Gas Emission Reduction and National Action Plan for Climate Change Adaptations. "Over the past five years, the government has consistently allocated around 4.1 per cent funding through the Climate Budget Tagging (CBT) towards climate," she said in a special address at the virtual International Islamic Capital Market Summit 2021 (ICMS2021), organised by the Centre for Research and Training (CERT). The Indonesian government developed and implemented the CBT initiative since 2016 to track how much the government was spending on climate change actions out of the national budget. However, Sri Mulyani said the amount was only able to finance 34 per cent of the total funding required to achieve Indonesia's Nationally Determined Contribution (NDC), that outlines the country's transition to a low carbon and climate resilience future. She also said the role of the private sector is expected to close the financing gap. Elaborating on the CBT, Sri Mulyani said it has also become a reference in the initiation of green sukuk issuance and was used to track climate change activities that are coordinated with the Gender Responsive Budget, considering that climate change has more impact on the marginalised group. From 2018 until today, she said that Indonesia has issued sovereign global green sukuk annually with a total financing of US$3.5 billion. On other policy developments, Sri Mulyani said the ministry is currently preparing a carbon pricing mechanism, where the expansion of the implementation in various states and synergy of climate change policies will be a key to the success of low carbon transition in achieving the net zero emission targets by 2060. “We are optimistic that Indonesia can take a bigger role in realising the transformation of green economy,” she said. Sri Mulyani's speech was read by Assistant Finance Minister for Financial Sector Policy, Dr Suminto. -- BERNAMA