Indonesia Receiving International Financial Support to Stimulate New Green Economy

After a long history of allowing its tropical mangrove forests to be systematically cut down for logging, agricultural, and industrial purposes, as well as being one of the worst offenders with respect to carbon emissions, Indonesia has recently made notable policy changes in an effort to move to a green, more sustainable economy.

Indonesian mangrove forest. Stock photo.

In recognition, the World Bank just approved its first ever developmental policy loan dedicated to climate mitigation and adaptations in Indonesia.

The $200 million loan - to be giving in four yearly installments - is designed to focus on key benefits, according to World Bank, including:

• The promotion of energy efficiency.
• A reduction in the overall use of fossil fuel.
• A reduction in forest loss, and peatland conversion and burning.
• The development of renewable energies, like geothermal and biomass.
• Improving infrastructure for water resource management.
• Improving the ability to respond to water-related climate change impacts, such as droughts and floods.
• Making farmers more prepared for climate change impacts (floods, droughts, and pests) on food production.

In praise, Joachim von Amsberg, World Bank Director for Indonesia, commented that, “Over the last two years, the (Indonesian) government has already managed to bring climate change into the national planning and budgeting process,” referring to the country’s new National Council on Climate Change.

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