The Ministry of Environment (KLH) has officially signed a Mutual Recognition Agreement (MRA) with one of the international carbon standards, Gold Standard, in Jakarta on Thursday, May 8. The signing of this MRA is an effort to expand the reach and strengthen the global position of the Indonesia Carbon Exchange market.  

Minister of Environment (LH)/Head of the Environmental Control Agency (BPLH), Hanif Faisol Nurofiq, stated that carbon trading, as part of the carbon economic value, is one of the key mechanisms in the effort to reduce greenhouse gas emissions to curb the rise in global temperatures 

“The carbon economic value reflects the social cost of carbon emissions and encourages companies and countries to shift to cleaner, low-carbon technologies,” said Hanif during the signing.  

Hanif also pointed out that Indonesia holds a strong position in the carbon market thanks to its rich biodiversity. With vast tropical forests and peatland ecosystems, the country has high potential for generating quality carbon credits.  

“But I want to emphasize that the funds raised through carbon trading must be used to support climate change mitigation and adaptation—not just as an economic gain,” he added. 

The mutual recognition agreement enables both parties to mutually acknowledge certificates, whether those recorded in Indonesia’s National Registry System for Climate Change Control (SRN-PPI) or those issued by Gold Standard.  

The cooperation will also cover two schemes within the carbon economic value—both voluntary markets and compliance-based carbon markets, which are aligned with regulations aimed at achieving emission reduction targets. 

“This has never happened before,” Hanif said. “So our hope is that now, we’ve made room for every kind of market—there’s no reason for this not to move forward.” 

This article is published in partnership with Katadata 
Original article here