Source: Ministry of Finance of the Republic of Indonesia

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The President Director of the Environmental Fund Management Agency (BPDLH) of the Ministry of Finance of the Republic of Indonesia, Djoko Hendratto, together with the Norwegian Ambassador to Indonesia, Rut Kruger Giverin, signed a Contribution Agreement (CA) regarding result-based contributions for emission reduction at the Ministry of Environment and Forestry in Jakarta, on Wednesday, October 19.  

The signing of this CA is an extension of the previous Memorandum of Understanding (MoU) signed between the Governments of Indonesia and Norway on September 12, 2022. 

During the CA signing ceremony, H.E. Ambassador Giverin underlined that Indonesia's policy and regulatory framework for reducing emissions from the forestry sector and other land use – which would be further supported by Norway's contribution – had delivered impressive results. 

“We are impressed by the number of policies that the Indonesian government have taken to reduce deforestation. Through the recently signed MoU followed by the CA signing today, we support the Government of Indonesia in achieving its climate goals through the Forestry and Other Land Uses (FOLU) Net Sink 2030 Operational Plan. Norway is proud to support these activities through a flexible and transparent funding mechanism,” Ambassador Giverin said. 

The contribution of funds from Norway would later be channeled through BPDLH under the Ministry of Finance. The Indonesian government itself pledged to allocate more than US$300 million in the state budget each year to support its FOLU Net Sink 2030 Operational Plan. 

President Director of BPDLH Djoko Hendratto said the CA included 21 items detailing the scope and activities, transparency, assurance of compliance and dispute resolution process of the program. 

“Indonesia has good financial management governance that adopts comprehensively regulated international standards. Therefore, the implementation of this CA will be based on Indonesian laws and regulations,” said Hendratto.  

Additionally, an MoU regarding FOLU Net Sink 2030 was also signed by the Government of Indonesia through the Ministry of Environment and Forestry (KLHK), and the United Kingdom (UK) through the Foreign, Commonwealth, and Development Office, on Saturday, October 22, 2022.  

The UK Minister of State for Asia, Energy, Climate, and Environment, Lord Goldsmith, said the UK Government commended Indonesia's international leadership on climate and environmental issues. Lord Goldsmith also expressed his appreciation for Indonesia's FOLU Net Sink 2030 Operational Plan and targets. 

The core of the FOLU Net Sink 2030 Operational Plan includes three technical actions at the site level. The first is actions that reduces greenhouse gas emissions, for example by controlling forest and land fires and reducing deforestation. The second is actions that maintains emission absorption, such as by watching out for and preserving the condition of existing forest cover. The third is actions that increases emission absorption, such as by rehabilitating forests and damaged land, or by expanding tropical forest areas. Through this structured and systematic approach, Indonesia hopes to achieve the GHG emission level target of 140 million tons less of CO2e by 2030s.