Indonesia launches green facility to promote economy and achieve climate targets

Recently launched in Jakarta, Indonesia, the Tropical Landscapes Finance Facility, aims to bring long-term finance to projects and companies that stimulate green growth and improve rural livelihoods.

Consisting of a loan fund and a grant fund, the facility will help Indonesia to promote economic development while contributing to hitting its climate targets under the Paris Agreement.

The facility will use public funding to unlock private finance in renewable energy production, and sustainable landscape management that reduces deforestation and forest degradation and restores degraded lands.

Dr Kuntoro Mangkusubroto, chair of the Steering Committee of the facility said at the launch of the facility in Jakarta that the ground-breaking and innovative financial platform is a world’s first, which can transform the lives and livelihoods of Indonesians in rural areas.

The event was attended by representatives of the business community, financial institutions and civil society.

Dr Siti Nurbaya Bakar, minister of Environment and Forestry, Republic of Indonesia, said to the audience, “We need to ensure that our landscapes produce sustainable goods. We fully support the Tropical Landscapes Finance Facility, which is in line with Indonesia’s sustainable development aspirations.”

In addition, Coordinating Minister for Economic Affairs Darmin Nasution of Republic of Indonesia said the Indonesian government realised that sustainable development goals can only be achieved through holistic policies such as landscape management. And he believes with the Tropical Landscapes Finance Facility, it aims to improve smallholder productivity while at the same time conserving the natural environment.

Key partners include BNP Paribas and ADM Capital, which will act as fund manager for the loan fund. UN Environment will manage the secretariat. BNP Paribas is a member of the UN Environment Finance Initiative.