Indonesia allows resumption of international carbon trade after four years
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Until the halt in 2021, Indonesia was one of the biggest suppliers of carbon credits to the international market, mostly through the Redd+ reforestation scheme.
PHOTO: ST FILE
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JAKARTA – Indonesian President Prabowo Subianto has issued a new decree to restart international carbon emissions trading after a four-year hiatus, according to a copy of the decree seen by Reuters on Oct 15.
The South-east Asian country issued carbon market rules in 2021 that focused on compliance carbon markets rather than transactions in voluntary markets.
The rules effectively put an end to all cross-border carbon emissions-credit trading, including those generated from big projects such as the Katingan Mentaya conservation project.
Indonesia said the moratorium allowed the country to prioritise meeting its own greenhouse gas reduction targets rather than selling the reductions overseas.
The halt also came amid concerns that carbon prices were too low and that selling countries were not benefiting from the market.
Until the suspension, Indonesia was one of the biggest suppliers of carbon credits to the international market, mostly through the Redd+ reforestation scheme.
The new presidential decree, signed last week and made public on Oct 15, allows international trade in carbon-offset units to resume in accordance with Indonesian national standards, or with standards set by the United Nations Framework Convention on Climate Change and other international certifiers.
The decree also calls for the establishment of a decentralised registry for carbon units that will be transparent and run in real time to prevent the double counting of carbon emissions reductions.
Mr Prabowo, who will mark his first year as president on Oct 20, plans to generate capital inflows from sales of carbon offsets to foreign buyers through projects such as rainforest preservation.
In 2025, Indonesia has signed mutual recognition agreements with international organisations that certify projects that cut greenhouse gas emissions, including Verra, Gold Standard, Global Carbon Council, Plan Vivo and the Joint Crediting Mechanism.
These deals were meant to facilitate international carbon trade and foreign investments to support Indonesia’s climate goals, officials have said.
Indonesia’s local carbon exchange
Indonesia has committed to reach net-zero greenhouse gas emissions by 2060 or earlier. REUTERS
