Indonesia’s Govt Controversial Plan to Redefine “Green”

Factory Chimney

  • The Financial Services Authority (OJK) and related ministries are currently revising Indonesia's Green Taxonomy. Behind this revision lies a pressing need for funding for captive PLTUs owned by industries including those related to battery and electric vehicle production.
  • To address funding challenges, industry players seek support from financial institutions in China, Japan, South Korea, and local banks. The government intends to enhance the participation of local banks, mainly state-owned institutions, through the Green Taxonomy revision.
  • Warning: Investors, especially those seeking alignment with sustainable assets, may question Indonesia's commitment to decarbonization and the reliability of its green taxonomy.

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