Indonesia urges regional enterprises to tap carbon market

Jakarta (ANTARA) - Indonesian Minister of Environment Jumhur Hidayat has called on regional government-owned enterprises (BUMDs) across Indonesia to explore carbon-related businesses as a new revenue source for their respective regions.

"BUMDs need to start identifying carbon units or activities that can be properly maintained and developed as a basis to drive regional revenue," Jumhur told reporters in Jakarta on Tuesday.

He made the statement after delivering his opening remarks at a technical briefing for regional leaders on Carbon Pricing Implementation and Climate-Resilient Low-Carbon Development.

Jumhur said that regional enterprises can turn carbon trading into a reliable revenue source while maintaining strict land management standards, ensuring that regional carbon potential remains well-preserved in the process.

He then pointed to mangrove restoration as an example, noting that mangroves can absorb around 3,000 metric tons of carbon dioxide equivalent per hectare annually.

Based on an estimated carbon offset rate of US$50 to US$60 per ton, the carbon value from a hectare of mangroves could reach around US$150,000.

Beyond local revenue potential, Jumhur stressed that regional governments must ensure the financial benefits of carbon trading reach local communities, in line with the central government's expectations.

According to Jumhur, the need to build local capacity around carbon pricing governance is also important, so that regional leaders can accurately understand carbon market mechanisms and opportunities.

Clear communication between central and local governments is essential, he added, to ensure that carbon market development yields maximum benefits for the public.

He expressed hope that, with BUMD involvement, regional environmental potential can be developed into economic activities that boost local revenue while benefiting communities.

Related news: Indonesia seeks greater community benefits from carbon trading

Translator: Tri Meilani, Raka Adji
Editor: Bayu Prasetyo
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