Indonesia’s Losses Amount to Rp544 Trillion from Climate Change Impact in 2020-2024

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Indonesian Finance Minister Sri Mulyani Indrawati has revealed the staggering impact of climate change on the country’s economy, with losses amounting to up to Rp544 trillion from 2020 to 2024 alone, as assessed by the National Development Planning Agency (Bappenas).

During a national meeting of the REDD+ RBP in Jakarta, Sri Mulyani emphasized that climate change and rising sea levels have had a significant effect on Indonesia’s Gross Domestic Product (GDP), ranging from 0.66 to 3.45 percent.

Considering Indonesia’s GDP, estimated at around Rp20,600 trillion, the potential damage and loss figures could reach Rp600.45 trillion. Sri Mulyani highlighted that the impact of climate change extends beyond economic implications, affecting human life and various sectors, including the economy and finance.

To mitigate potential catastrophe, Indonesia has systematically implemented measures such as the Green Climate Fund, which provides Results-Based Payments from REDD+. Sri Mulyani stressed the importance of inclusive efforts involving all communities and stakeholders, emphasizing that reliance solely on international payments is not sufficient.

She outlined several policies aimed at addressing the economic impacts of climate change, including climate budget tagging, green bonds, the establishment of the Environmental Fund Management Agency (BPDLH), and participation in multilateral funding initiatives like the Global Environment Facility (GEF).

Sri Mulyani urged regional governments to actively participate and demonstrate robust commitment through climate budget tagging at the local level. The emphasis on inclusive, multi-stakeholder efforts underscores the severity of the climate crisis and the necessity for comprehensive measures to mitigate its impacts on Indonesia’s economy and society.