Carbon Trading in Indonesia: A Reality Check
At the recent COP30 climate conference in Belem, Brazil, Indonesia presented its vision for carbon trading. The government imagined it like selling gemstones—mined, polished, and ready for buyers. However, the reality isn’t as shiny.
Indonesia claims it has huge carbon stocks, totaling 50 million tons of carbon dioxide equivalent (CO2e), which it has touted since 2021. They even say their carbon credits, some dating back before 2020, could be valued between Rp15 trillion and Rp16 trillion (around US$900-960 million).
But these grand claims have raised eyebrows among industry experts. Many business leaders and carbon consultants are skeptical. For them, recent carbon credits are more valuable than older ones. They worry that the government’s optimism is just a temporary rush rather than a sustainable plan.
At COP30, Indonesia managed to trade only 1.5 million tons of CO2e credits from its forestry sector. This figure isn’t as impressive as it sounds; it combines transactions from IDXCarbon since its launch in September 2023. Most buyers were local companies, and their identities were kept private, which raises concerns about transparency in a business that relies on trust.
According to recent data, the global carbon market is expected to grow significantly. In fact, it was valued at about $215 billion in 2021 and is projected to reach around $600 billion by 2030. This growth highlights the potential for countries like Indonesia to benefit from well-structured carbon market strategies. Experts emphasize that a clear regulatory framework and strict verification processes are essential for real success.
In contrast to earlier efforts, there seems to be a lack of concrete strategies in Indonesia. To truly engage the market, experts suggest that the government should focus on improving regulatory structures and establishing better engagement with international buyers. Successfully tapping into this market could not only help tackle climate change but also boost the economy.
As the conversation around carbon trading continues, it’s clear that actions speak louder than words. The path forward must be paved with solid plans, transparency, and genuine collaboration among all stakeholders.
For a deeper dive into Indonesia’s carbon trading activities, check out Tempo’s detailed coverage here.
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Carbon Trading, Carbon Credit, COP30
