Indonesia Loses Rp544tn from Climate Change Impact in 2020-2024

TEMPO.CO, Jakarta - Indonesian Finance Minister Sri Mulyani Indrawati revealed that the country faced a devastating loss of up to Rp544 trillion from the impact of climate change in 2020-2024 alone. The figure was assessed by the National Development Planning Agency (Bappenas).

“Bappenas estimated that the losses reach Rp544 trillion in 2020-2024,” Sri said during a national meeting of the REDD+ RBP in Jakarta, on Wednesday, February 21, 2024.

Sri explained that climate change and rising sea levels affect Indonesia's Gross Domestic Product (GDP) by a range of 0.66 to 3.45 percent.

“If we talk about GDP, which is around Rp20,600 trillion, then we are talking about damage and loss figures which could reach Rp600,45 trillion,” she said, as quoted from the Finance Ministry’s website.

The former managing director of the World Bank said that the impact of climate change would affect human life, such as the economic and financial sectors. Hence, Indonesia has systematically attempted to avoid potential catastrophe through the Green Climate Fund which provides Results-Based Payments from REDD+ (Reducing Emissions from Deforestation and Forest Degradation).

However, Sri emphasized that the effort does not solely depend on payments from international institutions. “This is also a matter of inclusivity where the participation of all communities and stakeholders is crucial,” she added.

The state treasurer outlined several policies that have been implemented to avoid the economic impacts of climate change, including climate budget tagging, green bonds, the formation of the Environmental Fund Management Agency (BPDLH), and participation in multilateral funding, such as the Global Environment Facility (GEF).

Sri Mulyani hoped that regional governments would actively participate and make a robust commitment through climate budget tagging at the regional level.

RIZKI DEWI AYU

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