Country Profile: 

Population (thousand) (2015): 257,563.82
Multidimensional Poverty Index Value (2012): 0.07
Inequality-adjusted Human Development Index, Country Rank (2014): 110
Gross Domestic Product per capita, at Purchasing Price Parity (2015) (US$): 11,035.1

Indonesia is the first developing country to make a voluntary commitment to reducing its GHG emissions by 26 percent using domestic resources and up to 41 percent with international support by 2020. This commitment was exemplified by then President Yudhoyono in the G-20 Leaders’ Summit in Pittsburgh in 2009 as well as during UNFCCC COP 15 and is now an integral part of the National Development Plan 2015-2019 under the current Government. To achieve these targets, Indonesia developed the National Action Plan for Reducing Greenhouse Gas Emissions (RAN-GRK) and the subsequent Regional Action Plan for Reducing Greenhouse Gas Emissions (RAD-GRK) for 33 provinces in Indonesia. The climate change mitigation commitment was later followed by the issuance of the National Action Plan for Climate Change Adaptation (RAN-API) in 2014 to ensure the low carbon development goes hand in hand with country’s resilience in anticipating adverse impacts of changing climate. 

Following a PEI Scoping Mission in November 2012 as a follow up to the Climate Public Expenditure and Institutional Review (CPEIR), the Sustainable Development Financing (SDF) project was set up in 2014. The project works towards setting up policy structures and strengthening cost-effectiveness of financing systems to meet the environment and climate change commitments (mitigation, adaptation and biodiversity) pledged by the Government. 

The SDF Project is coordinated by the Center for Climate Change Finance and Multilateral Policy (PKPPIM) at Fiscal Policy Agency (BKF) of Ministry of Finance. PEI collaborates with the UNDP ‘Strengthening Governance of Climate Finance to Benefit the Poor and Vulnerable’ project funded by the Swedish International Development Cooperation Agency and with the Biodiversity Financing (BIOFIN) project to implement the SDF Project in Indonesia. 

  •  Building on the recommendations of the Low Emissions Budget Tagging and Scoring System (LESS) study, undertaken in 2014, the Government has adopted a national budget tagging system for climate change mitigation activities to track and monitoring the budget and expenditures of intended mitigation activities. In July 2014, the Ministry of Finance issued Ministerial Decree No. 136/ 2014 that makes it mandatory for seven key line ministries (Ministry of Energy, Industry, Forestry, Environment, Public Works, Agriculture and Transport) to pilot the budget tagging system. This decree has been put into action with the budgets of line ministries effectively tagged for the 2015 fiscal year. 
  • In order to support implementation of the Regional Action Plan on Reducing EmissionS (RAD-GRK), a similar LESS study to track the climate mitigation expenditures leading to the development of budget tagging system at provincial level was conducted in first semester of 2015 in 3 provinces – Central Java, Jambi and Yogyakarta. Policy recommendations for implementation of budget tagging system for mitigation activities are currently being discussed with the Ministry of Home Affairs.
  • Under the SDF project, with support from SIDA, a poverty and gender sensitive Climate Public Expenditure and Institutional Review (CPEIR) has been conducted for East Nusa Tenggara (NTT) province in collaboration with UNDP-GEF Climate Adaptation project (SPARC project). This will be used to inform decision makers at the provincial and national level on how to ensure better pro-poor planning and budgeting activities pertaining to climate change mitigation and adaptation. 
Key Documents
Mainstreaming Resources: 
Presidential Regulation No. 61/2011 on National Action Plan for Reducing Greenhouse Gas Emissions (RAN-GRK)
National Action Plan for Climate Change Adaptation (RAN-API)