Indonesian Government is Ready to Present Green Investment Opportunity

JAKARTA: The Government of Indonesia is ready to present green investment opportunity targeting 20% increase for each year. Several ministries will explain green investment opportunity to attract national and international investor in the Tropical Landscape Summit: A Global Investment opportunity, taking place in Jakarta 27-28 April 2015.

“Presently, environmental friendly investment and industry development has been a global trend. For that, Indonesia will take its chance to attract green investment by becoming the host of Tropical Landscape Summit and presenting the country’s green investment opportunity portfolio,” said Head of the National Coordinating Investment Board, Franky Sibarani, in Jakarta.

Several global CEOs have been confirmed to be the speaker, such as Mr. Sunny Verghese, Group MD and CEO Olam International, Mr.Gary Kotzen, Vice President of Global Sourcing, Costco Wholesale, Mr. Mark Burrows Managing Directir and Vice Chairman, Global Investment Banking, Credit Suisse, and Mr. Stephen Rumsey, Chairman, Permian Global. “Several National CEOs will also be speakers in the sessions to share experiences on investing in Indonesia,” added Franky. The participants come from Australia, Switzerland, China, France, US, UK, India, Thailand and Singapore.
According to Franky, in the last 5 years (2010-2014) the total of green investment realization reaches 30.3% from the overall investment, worth IDR 486 trillion compared to the total investment value amounting IDR 1,600 trillion. From that realization, a total of USD 26.8 billion is foreign investment and IDR 139.1 trillion is domestic investment.

BKPM has targeted that the green investment will increase averagely 20% for each year so by 2019 foreign green investment can reach USD 56 billion and IDR 448 trillion for domestic.

The Tropical Landscape Summit, he added, will be very strategic to Indonesia to be a role model for sustainable green economy development. Therefore, to accelerate the development of green infrastructure or environmentally sensitive infrastructure development will require relatively high cost and this event is expected to be a good opportunity to attract investors.

According to Franky, a number of economy ministers such as Energy Minister Sudirman Said will present opportunity for renewable energy and energy conservation in each area. Environment and Forestry Minister Siti Nurbaya will explain about ecotourism opportunity and the existing incentives within her ministry.

“Other economy ministries will also promote green investment opportunity program and discuss directly with the relevant stakeholder in terms of policy framework and supporting ecosystem for green economy,” added Franky.

Eight potential sectors for green investment are agriculture, forestry, fisheries, geothermal power efforts (biomass, biofuel, and transportation component), electricity supply from renewable sources, waste management and recycle, and ecotourism.

New and Renewable Energy

The Energy Minister Sudirman Said emphasized that green investment in energy sector will become the priority for the government, especially in development of renewable energy and energy conservation. “But to develop renewable energy program we need bigger budget, 10 times bigger than the current 2015 state budget (IDR 1.03 trillion),” he said.

He added that Indonesia have a great potential resource for renewable energy. The data from the Energy Ministry shows that these resources are from the hydro energy (75 gigawatt), solar energy (112 gigawatt), biofuel (32 gigawatt), wind (0.95 gigawatt), biomass (32 gigawatt), geothermal (28.8 gigawatt) and maritime (60 gigawatt).

Furthermore, Sudirman also explained that the government has mandated to mix 15% palm-oil based biodiesel (Crude Palm Oil/CPO) to be mixed with diesel fuel. “This is why the Energy Ministry is requesting for more budgets on New and Renewable Energy to increase the production and consumption of this new energy, so that Indonesia is not so much depending on fossil energy, and gradually can replace the fossil fuel.

Transformation

Franky explained, in industry development program and investment, business practitioner play a very important role in transforming business as usual scheme into green industry. Moreover, the UU No.3/2014 becomes a legal standing for national industry to be changed into green industry in terms of production process by addressing efficiency and effectivity use of resources for sustainability.

The Environment and Forestry Minister Siti Nurbaya evaluates that so far, most of business practitioner still do not understand managing risks of development project, especially on community and environment.
“If we’re looking into forest degradation, the data is quite shocking, especially during 1996-2006, it reached 2 million hectares. But now it’s drastically decreasing, from 2006 to 2014 it becomes 600 thousand hectares. The existing destruction happens because incentives in green investment have not been socialized very well to the business sectors,” she explained.

According to Siti, the government policies for green investment have been in place, such as corporate reputation through ranking program. “Companies should be efficient and profitable, but also should consider the environment and sustainable development.”

Siti admitted that green investment implementation costs a high amount of money. Therefore, her ministry engages the Financial Service Authority to develop supporting policy so that banks and financial institution would provide incentives for companies who are doing green business.

BKPM in organizing Tropical Landscape Summit is collaborating with Presidential Chief Staff and United Nations Office for REDD+ Coordination (UNORCID). This international summit is very prestigious as it convenes national and international speakers and decision makers, 12 economy ministers, deputy governor of Bank Indonesia, commissioner of FSA, Indonesia Chamber of Commerce, and 40 national and international CEO of various industries, governors and mayors, and 20 NGOs. It will be attended by 700 registered participants comprising domestic and international CEOs, academics, NGOs, research institutions and other government partners.

“We encourage all stakeholders to support green investment by participating and contributing through this important moment,” Franky said. Registration is free and can be done through www.summit2015.org.

More information :

Sekretariat Tropic (Tropical Landscape Summit)

Kepala Biro Peraturan Perundang-Undangan, Humas dan TU BKPM RI
Ariesta Riendrias Puspasari
HP : +62816 1946825 ; email : ariesta@bkpm.go.id

Natasha Ardiani, Sekretariat TLS
HP: +62 81 1101 7222; email: natasha.ardiani@gmail.com

Brittany Benson, Sekretariat TLS
HP: +62 822 9135 1507; email : brittany.benson@unorcid.org