The recently launched Indonesia Green Taxonomy 1.0 has color-coded economic activities based on their contribution to climate change mitigation: green, yellow, and red. For this taxonomy to effectively drive Indonesia economy towards a low-carbon future, our analysis recommends several key measures to ensure its interoperability with other relevant global taxonomies as well as clearer thresholds and transition pathway for the yellow category.

A cautious sense of optimism has buoyed us throughout 2021 and landed us into 2022. Here is a reflection of the progress we have made towards Climate Finance in Indonesia in 2021, and a preview of what is in stock for 2022.

Indonesia is preparing a carbon tax to cut down emissions and free up funds for climate action. But a carbon tax on coal and fuels will not affect buyers as the cost is kept artificially low by government subsidies. To achieve its goal, the carbon tax should open a wider opportunity for Indonesia to refocus its state budget, and phase out its fossil-fuel subsidies. This blog highlights the key elements for the carbon tax to launch successfully.

Indonesia has listed carbon pricing as one of the key climate finance instruments on its climate policy directions, recognizing the potential value of voluntary carbon markets. This blog proposes how tropical forest-rich countries such as Indonesia can respond positively to the upsurge of voluntary carbon markets.