In 2017, Indonesia announced its goal of integrating low-carbon, green growth into its national development strategy. To support this effort, WRI led a research consortium to explore the potential of low-carbon development, resulting in the central positioning of green growth in Indonesia’s national development plan for 2020-2024.
Indonesia, the world’s fourth-most populous country, has achieved impressive economic growth, with per capita GDP rising from $800 in 2000 to nearly $4,000 in 2018. However, this has come at a cost, with unsustainable levels of resource extraction, a surge in motor vehicle traffic and heavy reliance on coal-burning, which contributes to air pollution-related diseases suffered by nearly 60% of Jakarta residents. Sustainable development in Indonesia will require a low-carbon pathway that can drive growth while enhancing health, welfare, and climate resilience.
In 2017, the Ministry of National Development Planning (BAPPENAS) launched the Low Carbon Development Initiative (LCDI) to put low-carbon development at the core of Indonesia’s next five-year development plan. The government invited the New Climate Economy (NCE), for which WRI is the managing partner, and WRI Indonesia to support it on LCDI. NCE and WRI Indonesia coordinated with a research consortium of international and local partners to support BAPPENAS in developing thematic studies and an overall report.
Launched by the government in March 2019, the LCDI report, Low Carbon Development: A Paradigm Shift Towards a Green Economy in Indonesia, found that a sustainable, inclusive growth path for Indonesia can deliver average GDP growth of 6 percent per year through 2045 and, compared to business as usual, create more than 15 million additional greener and better-paying jobs, halve extreme poverty, and save 40,000 lives annually from reduced air and water pollution – all while reducing greenhouse gas emissions by nearly 43 percent by 2030, exceeding Indonesia’s current international target. NCE and WRI Indonesia also helped inform the development planning process by supporting BAPPENAS, the prominent LCDI Commissioners and NCE’s Global Commissioners in extensive communications and engagement around the LCDI report.
In January 2020, Indonesia released its first-ever sustainable development plan, RPJMN 2020-2024, which includes greenhouse gas emissions reduction as a key macro-economic indicator alongside GDP growth, poverty reduction and employment. The LCDI effort helped shift views in some key parts of government away from considering climate action and growth as trade-offs and towards recognition of the benefits of climate action. As the one of the world’s largest economies and highest greenhouse gas emitters, Indonesia’s identification of an inclusive, low-carbon development pathway is inspiring other countries to look to it as an example. NCE and WRI Indonesia are now supporting the government to increase cross-sectoral implementation of LCDI across the country.