Why Indonesia

Indonesia is uniquely positioned for forest development and carbon credit generation due to its natural resources, government support, and strategic market potential:

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1. Vast Natural Resources: Indonesia has over 125 million hectares of tropical forests, making it the world’s third-largest tropical rainforest country (FAO, 2020). Its peatlands and mangroves are highly effective carbon sinks, storing up to 20 times more carbon than other ecosystems (CIFOR, 2019).​

2. High Carbon Sequestration Potential: Peatlands in Indonesia store approximately 57 billion tons of carbon (Center for International Forestry Research). This makes them crucial in global efforts to mitigate climate change and reduce greenhouse gas emissions.

3. Government Commitment: President-elect Prabowo Subianto has announced plans for a $65 billion Green Fund by 2028, aimed at funding projects like rainforest conservation and reforestation through carbon credit sales (Jakarta Post, 2024). His administration plans to establish a special mission vehicle to manage these projects, ensuring regulatory oversight and adherence to international standards.

4. Favorable Market Conditions: According to a study by McKinsey, Indonesia is among the top two feasible countries for forest carbon projects, alongside Brazil. Factors include competitive costs for project development and high carbon yields, making it an attractive investment destination.

5. Strategic International Partnerships: Indonesia has entered into agreements with countries like Norway to support emissions reductions, further boosting investor confidence in its climate action framework (Norwegian Ministry of Climate and Environment, 2022).

 

These factors position Indonesia as a global leader in carbon credit generation, offering substantial opportunities for investors and stakeholders in forest development projects.