MANDALA

INDONESIA'S TRANSITION TO GREEN ECONOMY

MANDALA CONSULTING, OCTOBER 17, 2023

Indonesia, a top ten emitter of greenhouse gasses, must transition to a green economy due to costly impacts of climate change that disproportionately affect vulnerable populations, and positive economic opportunities in the long run, including potential GDP growth of 6.5% and creation of 2.8 million green jobs. The country’s mitigation plan is rated as “highly insufficient,” and no explicit net zero target has been communicated. The power, manufacturing, and transportation sectors account for 78% of Indonesia’s greenhouse gas emissions and must achieve the country’s emission reduction targets. However, the country faces significant challenges in reducing emissions in these sectors, such as the continued dominance of fossil fuels in the power sector and the heavy reliance on fossil fuels in transportation. Nonetheless, Indonesia has an opportunity to pursue policies and measures, such as revising planning documents, reducing reliance on coal and other high-emitting industries, boosting renewable energy development, and increasing the use of mass transportation and electric vehicles, to successfully transition to a green economy.

THE PURPOSE OF THIS DOCUMENT IS TO PROVIDE GENERAL INFORMATION ABOUT INDONESIA'S TRANSITION TO A GREEN ECONOMY. THE CONTENTS OF THIS DOCUMENT SHOULD NOT BE CONSTRUED AS SPECIFIC RECOMMENDATIONS OR ADVICE. FOR QUESTIONS ABOUT THE CONTENTS OF THIS DOCUMENT, PLEASE CONTACT MANDALA CONSULTING. THE INFORMATION IN THIS ARTICLE IS ACCURATE AS OF THE PUBLICATION DATE. HOWEVER, DUE TO THE RAPIDLY CHANGING NATURE OF THE LAW IN INDONESIA, THE ACCURACY OF THE INFORMATION CANNOT BE GUARANTEED WITHOUT UPDATES.

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