Millennials Should Start Keeping an Eye on Climate Finance Management in Indonesia

Many might not be familiar with the term Climate Finance, as there is no normative definition of this term. The term Climate Finance was first introduced in 1992, when United Nations Framework Convention of Climate Change (UNFCCC) during Earth Summit in Rio de Janeiro agreed that developed nations shall provide financial resources to developing nations to help them mitigate climate change. It basically can be described as the flow of funds from donor countries to receiving countries for mitigation/adaptation actions of climate change, such as establishing hydro-power plant or developing infrastructures that are adaptive to climate change. Following the firm actions both in Earth Summit and Kyoto Protocol (1997), in Copenhagen Accord (2009), donor countries have committed to provide USD100 billion a year by 2020 to support a better mitigation efforts and reduce Green House Gases (GHG) emissions.
In the meantime, Indonesia’s government has developed National Action Plan for Climate Change Adaption (RAN-API) which is focused on both mitigation and adaptation actions of climate change. The four focuses of RAN-API are: a) economic resilience; b) livelihood resilience; c) ecosystem resilience; and d) special areas resilience (e.g. coastal and small islands). This national action plan plays an important role on guiding National Medium Term Development Plan (RPJMN). The principle of green economy has been added to the development and planning policies (RPJMN 2015–2019) and will be a foundation of the development program (2015). National Medium Term Development Plan 2015–2019. Retrieved from http://www.lse.ac.uk/GranthamInstitute/law/national-medium-term-development-plan-2015-2019-rpjmn-2015-2019/

The collaborations of climate change mitigation/adaptation actions in Indonesia involve national coordinating team for climate change, experts as well as partners such as German Agency for International Cooperation (GIZ), Japan International Cooperation Agency (JICA), Climate and Development Knowledge Network (CDKN) and so on. The National Development Planning Agency (BAPPENAS) is a responsible agency for formulating guidelines for climate change mitigation/adaptation actions plan as well as coordinating monitoring and evaluation of RAN-API. On the other hand, Indonesia’s government also established Indonesian Climate Change Trust Fund (ICCTF) in 2009. ICCTF as a national non-profit organization has a function for managing climate finance from various sources.
The financial sources are coming from national (government funding, NGO, CSR) and international funding (international climate finance). A study in 2011 conducted by Ministry of Finance and Climate Policy Initiative (CPI) on the Landscape of Public Climate Finance in Indonesia as reported in The Coordination of Climate Finance in Indonesia (2014) showed that the amount of USD 951 million of climate finance came from public sources — with most of the funding came from domestic sources (66%). According to Country Assessment Report (2013) which was done by GIZ and Adelphi, the total international climate finance committed to Indonesia is in the range of USD 3.1–4.4 billion and 73 percent of the fund is in the form of loans.
In the near future, the amount of the funding will be likely to rise. Indonesia has announced a national target to reduce GHG emissions to 26 percent (without international funding) until up to 41 percent (with international funding) by 2020. The Ministry of Finance has developed Mitigation Fiscal Framework (MFF) to monitor and evaluate National Action Plan to reduce GHG emissions (RAN-GRK) targeting the reduction 767 million tonnes of carbon dioxide (mtCO2) in 2020. RAN-API complements mitigation/adaption actions which was formulated in RAN-GRK.
RAN-GRK emphasizes on five aspects, include: 1) Forestry and Peat land; 2) Energy and Transportation; 3) Agriculture; 4) Industry; and 5) Waste Management, which contribute for the most GHG emissions in Indonesia. As quoted in Tempo, finance minister during a national symposium titled “National Symposium on the Rise of Moving, Indonesian Youth Lead the Nation” urged young people to be critical towards government. She said that young people should keeping an eye on government and criticizing the development of the country, while always educating themselves with the various knowledge.

While Indonesia’s government keep improving the management system of national and international financial flows, the intermediate reports of climate finance from the related ministry and international partners help us to monitor the adaptation and mitigation activities. Nowadays, we have seen many private sectors taking part in mitigation/adaptation of climate change through Corporate Social Responsibility (CSR), yet there is still no integration for Measurement, Reporting and Verification (MRV) from local to national level as reported in Country Assessment Report (2013).
COP23 will be held this year on November in Bonn and will be a platform to discuss further and realizing Paris Agreement’s goals. Let’s hope it will bring clearer guideline and push global leaders stronger to execute what they have pledged.
