Indonesia's Readiness to Implement Green Economy | Bahasa

Indonesia, 17 Jul 2020 - A number of experts believe that green economy can help deal with the economic impacts of the Covid-19 pandemic. Therefore, Asian Insights Conference 2020 held by Bank DBS Indonesia on July 16 took 'Fixing a Fragile World: Anticipating the Next Black Swan?' as its theme. Present as speakers at the panel discussion were Executive Director of Lingkar Temu Kabupaten Lestari Gita Syahrani, Executive Chairman of the Green Trade Initiative Foundation Fitrian Ardiansyah and Landscape Indonesia Chief Executive Officer Agus Sari.

"Sustainability is one of the priorities and business focuses of Bank DBS Indonesia. We continually strive to apply values ​​and measures of sustainability in every line of our business, work culture and banking activities. The DBS Asian Insights Conference represents Bank DBS Indonesia's commitment as a banking institution that is driven by the goal of creating economic and environmental balance," said PT Bank DBS Indonesia President Director Paulus Sutisna.

Besides government policies and stimulus packages, economists believe that green economy can boost Indonesia’s economy. Green economy is an idea that aims at improving people’s welfare while preventing an increase in greenhouse gas emissions and overcoming the effects of climate change.

Landscape Indonesia Chief Executive Officer Agus Sari said the government’s stimulus could lend weight to efforts to develop a green economy. The basic principle of sustainability dictates that economic, social, and environmental factors be mapped comprehensively. Sacrificing one of them will sacrifice all three. Furthermore, all three factors must be mapped to determine which sector is resilient under all conditions, including the current pandemic. The stimulus should not be given to vulnerable or even damaging sectors.

“The pandemic is rare although everyone knew it was bound to happen. One way or another, is this a black swan? Not necessarily, because this is definitely happening, only we don't know when. Therefore, we must anticipate it although it is rare," he said.

Agus added that the energy sector is one of the sectors that deserve full attention in the development of a green economy. There is still plenty of room for the development of renewable energy in the country. Furthermore, the pandemic also teaches us that the health and pharmaceutical sectors in Indonesia are still very vulnerable. This means it is important to develop the two sectors.

West Java Province has started to take sustainability measures in development projects and manufacturing industries. "We see seven opportunities that are the focus of West Java Province in developing the economy amid the pandemic. One of them is that our business and industry are heading toward sustainability. We are currently transforming five plastic factories into solar plants using municipal waste as combustible material to replace coal. The plants are being built in Bogor and several areas in West Java," said West Java Governor Ridwan Kamil.

In addition, the National Development Planning Agency (Bappenas) has determined that low-carbon development can produce a gross domestic product (GDP) of more than 6% annually, starting now until 2045. The government has an important role to create a sustainable green investment strategy so that Indonesia's economic growth can get back on track.

Preparations for the implementation of green economy are underway and have attracted the attention of investors and business people. Gita Syahrani, Executive Director of Lingkar Temu Kabupaten Lestari, said that green investment is an effective stimulus in overcoming the impacts of the Covid-19 pandemic. Local governments have adopted innovative policies for sustainable development that protect the environment while improving people’s prosperity, such as the Green Sigi Bylaw and the Regulation of the Siak Hijau Regent. This is to ensure that every development activity is carried out while maintaining ecological functions, such as water availability, good soil and air quality, and access to renewable energy sources. When this happens, then resilience against disaster, including Covid-19, will increase.

Nevertheless, the large potential of green economy does not necessarily attract investors. High risk and a long process are some of the deterring factors for investors. In addition, profit forecasts are still uncertain. 

Green Trade Initiative Foundation Executive Chairman Fitrian Ardiansyah said that resilience in a green economy is very important, especially in terms of investment. "This is because no investors will invest in it if the business does not last long or does not yield profits or cause new problems. Profit is related to productivity, to health and sustainability. Investors seek a business model that can boost productivity while ensuring sustainability and offering benefits to the environment and society," he said.

Commenting on Fitrian’s statement, Gita Syahrani said that equitable development has always been a national target. "However, when viewed from the flow of investment, it is not enough. This is a good time to attract investment that strengthens infrastructure and MSMEs, and support human resources for the development of domestic supply chains, especially for sustainable derivative products, based on a region’s potentials, such as honey, moringa, or other natural spices. Data shows that Indonesian consumers currently support local products, so I'm sure the penetration of sustainable local products into e-commerce platforms, for example, can increase, if supported by national policies."

Given these conditions, green economy is a necessity and can be considered for a valid development scenario. Each region will have its own added value. Further, the economy will also increasingly favor the people, not because they are entitled to it, but because they are able to manage local economies.

Good cooperation between the central government and financial institutions and private companies is crucial to revive Indonesia's economy. Bank DBS Indonesia is committed to creating a balanced environment between the economy and business. "As a bank, we continuously strive to apply the value of sustainability to the awareness of our role as a financial institution, which runs a sustainable business for future generations and the environment. Bank DBS Indonesia implements this value through leading and trusted banking services, and is curated according to customer needs. We are also actively involved in the development of social entrepreneurship in Indonesia through the DBS Foundation," said PT Bank DBS Indonesia President Director Paulus Sutisna.

 

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