Details regarding Indonesia’s plans to launch a $65 billion green economy fund have surfaced across media platforms. The fund, to be spearheaded by President-elect Prabowo Subianto, will raise capital through the sale of carbon emission credits generated from rainforest preservation and other environmental projects. The initiative aims to hit its target by 2028.
According to reports, a new regulatory body will be established to oversee Indonesia’s carbon emission policies in line with the Paris Agreement. As part of this effort, a “special mission vehicle” will be created to manage the green fund and operate carbon-offsetting projects. The projects will focus on forest conservation, reforestation, and mangrove restoration to generate internationally marketable carbon credits.
In an interview, Prabowo’s climate policy adviser, Ferry Latuhihin, explained that the fund aims to leverage Indonesia’s rich natural resources. He added that the scale of the fund is expected to help the country, which is among the world’s top 10 emitters and home to the third-largest tropical rainforest, achieve net carbon neutrality by 2060.
Despite the ambitious targets, experts have highlighted challenges in the competitive global carbon market. Christina Ng, managing director of the Energy Shift Institute, noted that while Indonesia’s natural ecosystems offer significant potential for carbon offset projects, achieving the $65 billion target will be financially and operationally demanding.
The incoming government plans to provide seed capital for the fund and will promote its projects to international investors while adhering to strict global verification standards.
