Indonesia reaffirmed its ambition to become the center of high-integrity global carbon markets during a talk show at the Indonesia Pavilion at COP-30 UNFCCC on 15 November 2025. At the international forum, Ilham, Director of Forest Utilization Business Development at the Ministry of Forestry, outlined the national strategy to transform Indonesia’s natural wealth into a sustainable climate-finance engine.
With 125.89 million hectares of forests and megadiverse ecosystems that position it among the world’s largest natural-capital holders, Indonesia presents itself not only as a resource owner but also as a key driver of the global carbon market. “Indonesia is a natural capital powerhouse, with forests, peatlands, and mangroves holding essential global carbon value,” Ilham stated.
Ilham explained that Presidential Regulation No. 110/2025 on Carbon Economic Value serves as the core foundation for strengthening the national carbon market. The regulation is designed to build a competitive and benefit-driven carbon-trading system aligned with Indonesia’s FOLU Net Sink 2030 and SNDC targets.
Through Forest Utilization Business Licensing (PBPH) and the Social Forestry program, the carbon economic value framework creates opportunities for Indigenous communities, forest-adjacent villages, and grassroots forestry actors. “Through protection, restoration, and participatory forestry, carbon value can directly benefit rural households,” Ilham noted.
He emphasized that carbon trading is not only a mitigation instrument but also a major economic opportunity. Carbon schemes in the forestry sector are projected to create thousands of jobs and generate carbon-trade value amounting to billions of rupiah annually.
“When carbon opportunities are linked to community-based forest management, conservation and prosperity can advance together,” he said. This model also reduces the risk of social conflicts in areas with close interaction with forests.
Ilham also highlighted the vast potential of conservation ecosystems that remain underutilized. National parks, he said, could become consistent and long-term climate-finance sources when integrated into carbon-trading frameworks.
Presidential Regulation No. 110/2025 paves the way for Indonesia to take a greater role in international carbon trading through Result-Based Payment (RBP), the Emission Trading System (ETS), and Mutual Recognition Arrangements (MRA). These instruments enable Indonesian carbon credits to meet Article 6 standards under the Paris Agreement.
“We now have access to cross-border markets with internationally compatible mechanisms, including the application of corresponding adjustments to safeguard credit integrity,” Ilham explained.
The credibility of Indonesia’s carbon market is strengthened by the Carbon Unit Registry System (SRUK), designed to be transparent, traceable, secure, and compliant with global standards. This system serves as the backbone for accountability and verification of Indonesia’s carbon credits.
Concluding his presentation, Ilham described the carbon market as a key instrument for national economic diversification. “With effective governance and business processes that uphold environmental integrity and social benefits, the carbon-market ecosystem will become the locomotive of Indonesia’s green economy,” he said.
With solid regulations, strengthened governance, and technical readiness through SRUK, Indonesia is steadily advancing toward its goal of becoming a center for high-integrity carbon trading in the region and globally.
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