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Addressing Indonesia's green investment gap
Indonesia has begun to tap into the green bond market, both at home and overseas, to finance environmentally friendly projects.
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Indonesia has begun to tap into the green bond market, both at home and overseas, to finance environmentally friendly projects.
(Shutterstock/File)
Indonesia has begun to tap into the green bond market, both at home and overseas, to finance environmentally friendly projects.
In February, Indonesia issued sovereign green bonds worth US$1.15 billion in the international bond market, the first sovereign bonds issued by an Asian country. Just recently, state-owned infrastructure financing company PT Sarana Multi Infrastruktur (SMI) announced it would offer green bonds of about Rp 1 trillion in the local bond market by the end of the first half to boost its financing capacity. If realized, SMI will become the first company to issue domestic green bonds.
Green bond issuance could become an important financing alternative to finance future infrastructure projects.
Driving strong economic growth without harming the environment is not impossible. The Organisation for Economic Cooperation and Development (OECD) has stated that, with the right mix of “green policies”, G20 countries’ GDP can grow by up to 5 percent on average in the medium term, counting in the net effect of stronger climate change mitigation.
