Indonesia officially launched its forestry carbon trading ecosystem on July 6, marking a significant milestone in the country’s efforts to develop its carbon market as a new engine of economic growth. The inaugural issuance covers approximately 31 million tons of carbon dioxide equivalent (CO₂e), with total transaction value estimated to reach Rp5 trillion (approximately US$277.52 million). The initiative is projected to generate around Rp500 billion (US$27.77 million) in non-tax state revenue (PNBP).
Forestry Minister Raja Juli Antoni announced that the ministry will issue ministerial approvals and facilitate the release of forestry carbon credits to three Forest Utilization Business Permit (PBPH) holders and one social forestry entity. The formal handover of the credits took place three days prior to the official launch of the Carbon Unit Registry System (SRUK) on July 9, which will serve as the primary infrastructure for Indonesia’s national carbon market.
“This is part of the President’s mandate as a new engine of growth to achieve 8 percent economic growth, particularly utilizing green growth, so that there is a balance between development, the economy and ecology,” Antoni explained. The initial four carbon projects span approximately 225,000 hectares, with the potential to prevent around 30 million tons of CO₂ equivalent in greenhouse gas emissions.
Antoni emphasized that Indonesia’s carbon economic potential can only be maximized through good forest governance that is transparent, accountable, and free from corruption and manipulation. He noted that the country has a potential area of approximately 12.7 million hectares for carbon trading, suggesting immense room for expansion. “If that can be utilized, Indonesia has a massive opportunity to develop its carbon economy,” he said.
The Indonesian government has repeatedly affirmed its commitment to establishing a credible, transparent, and highly integrated carbon market as a key mechanism to mobilize global climate finance. According to Antoni, the main challenge facing global climate finance today is the lack of a conducive investment climate that allows capital to flow securely and at scale into climate solutions. He emphasized that carbon markets hold significant potential to channel global investment into emission reductions, forest protection, ecosystem restoration, and sustainable regional development.
Given that Indonesia is home to one of the largest tropical rainforest expanses on earth, Antoni stressed that building a highly integrated, globally trusted carbon ledger is a vital geopolitical and macroeconomic priority for Jakarta. The green economy is positioned as one of the new engines of growth expected to support Indonesia’s ambitious 8% national economic growth target. Beyond driving economic growth, carbon trading serves as an instrument to reduce greenhouse gas emissions, develop carbon markets, and boost the village economy — a key directive from President Prabowo Subianto. The government continues to fortify national carbon governance through ongoing policy reforms and the strengthening of institutional instruments.