Development, Environment & energy | Southeast Asia

15 March 2022

Despite focusing on the country’s COVID-19 recovery, Indonesian policymakers cannot afford to sideline low carbon development projects and other sustainable development initiatives, Hening Wikan writes.

In 1992, the United Nations Conference on Environment and Development in Rio de Janeiro, known as the ‘Earth Summit’, was the first wake-up call for countries about the need to join forces to achieve sustainable development. 30 years have now passed, but governments across the world still face major challenges concerning environmental protection and creating disaster-resilient communities, exacerbated by the impacts of climate change.

As an archipelagic nation, Indonesia is highly vulnerable to the impacts of climate change, and it faces a range of challenges in relation to sustainable development. In terms of its efforts to address these issues, negotiated international agreements have been a focal point for the country’s policymakers.

As part of the 2016 Paris Agreement, the Government of Indonesia committed to reduce emissions by 29 per cent without conditions, and by 41 per cent with international assistance, against the business as usual scenario by 2030.

The government also incorporated reduction of greenhouse gas emissions in the Medium-Term National Development Plan 2015–2019 (‘RPJMN’ in Indonesian). They planned to reduce emissions by 26 per cent by 2020. During President Joko Widodo’s second term, the target was increased to 27.3 per cent by 2024.

Several measures have been taken to achieve the RPJMN target, including the establishment of climate change financing. In general, the sources of this funding are public and multilateral financing instruments managed by a number of ministries, such as the Ministry of Finance, the Ministry of National Development Planning/National Development Planning Agency, and the Ministry of Environment and Forestry (INDEF).

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Government agencies have also utilised specific tracking systems to plan, monitor, and verify their low carbon development (LCD) projects. One study from the SMERU Research Institute in collaboration with the Ministry of National Development Planning/National Development Planning Agency and INDEF found that there were 16,189 climate actions which have reduced around 23.46 per cent of emissions cumulatively in December 2019.

Since then, the COVID-19 pandemic has posed a major challenge for Indonesia. Government agencies are now focusing their programs more on both controlling the spread of the virus and managing the country’s economic recovery. Climate change policies were not considered part of this national strategy even though they can offer an opportunity to support economic recovery.

In 2020, the budget for LCD projects decreased by around US$790 million. This included reductions to subsidies and public service obligations from prioritised sectors, such as forestry and peat lands, industrial processes and product use, agriculture, coastal and sea areas, energy, transportation, and waste management.

While understandable in the context of the pandemic, the sidelining of long-term emissions reduction policy measures in national budget allocations will have major implications for sustainable development. The study also found that these budget cuts could hinder Indonesia’s ability to achieve its emissions reduction target.

The implementation of existing LCD projects already faced several challenges resulting from supply chain issues, a lack of harmonised regulation and utilisation, and insufficient support for the development of green technology.

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To address these issues, more funding is required from both government and non-government sources.

In addition to increasing funding for LCD projects, the Indonesian Government needs to shift the way it approaches climate change policy.

In Indonesia’s disaster-prone territories, it is critical to address socio-economic vulnerabilities – not only the environmental risk – in order to build stable and resilient communities. This includes developing disaster governance which prioritise vulnerable groups that may not have the financial capacity to adapt following climate related disasters.

In February 2021, the worst flooding in five years submerged much of Semarang. The flood damaged properties, displaced 3,066 families, and killed three people. For years, low-income households have suffered the most, as many live in hazard-exposed areas and don’t have the resources to invest in risk-reducing measures, and disaster governance and government policy responses haven’t been sufficient to reduce the impact.

The impact of climate related disasters is the result of the intersection between weather events and pre-existing inequalities on the ground. Climate change worsens hazards, while inadequate disaster prevention policies magnify vulnerability. Shifting the approach to climate change policies is needed to be more sensitive to place-based risks and develop stronger action plans.

Therefore, it is time for the Indonesian Government to take two critical actions to enhance Indonesia’s climate change policies. It must provide more funding for LCD projects and further integrate socio-economic vulnerabilities in its long term policy-making.

By taking these measures, Indonesia will be able leverage their influence in the post-pandemic global recovery, and also go some way to fulfilling the promise of sustainable development made at the Earth Summit 30 years ago.

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