BISNISREAL.COM, JAKARTA, Indonesia – Thursday March 13,2025 Indonesia is gearing up to launch its forestry carbon trade, a move that Minister of Forestry Raja Juli Antoni says will be a major driver of green economic development and climate change mitigation. The program is expected to generate trillions of rupiah in revenue and create thousands of jobs.
The carbon trade will initially involve forest management schemes by private companies (Forest Utilization Business License Holders/PBPH) and Social Forestry programs. PBPH projects have the potential to absorb 20-58 tons of CO₂ per hectare, with prices ranging from USD 5-10 per ton of CO₂. Social Forestry initiatives can absorb up to 100 tons of CO₂ per hectare, with prices reaching EUR 30 per ton of CO₂.
In 2025, the forestry sector’s carbon trade potential is estimated at 26.5 million tons of CO₂, with transaction values between 1.6-3.2 trillion rupiah per year. If optimized by 2034, this could soar to 97.9 – 258.7 trillion rupiah annually, contributing 23 – 60 trillion rupiah in taxes and 9.7 – 25.8 trillion rupiah in non-tax state revenue. Additionally, the program is projected to create 170,000 jobs across various carbon project locations.
Minister Antoni emphasized that the carbon trade will not only focus on emissions reduction but also accelerate reforestation through conservation and Afforestation, Reforestation, and Revegetation (ARR) strategies.
To ensure Indonesia’s carbon trade competitiveness, the Ministry of Forestry, in collaboration with the Ministry of Environment and Forestry, is working to finalize Mutual Recognition Agreements (MRAs) with international standards like Verra, Gold Standard, and Plan Vivo by May 2025. The government is also revising Presidential Regulation No. 98 of 2021 on Carbon Economic Value (NEK) to enhance the effectiveness and transparency of carbon trading.
“With these steps, the Ministry of Forestry is optimistic that the forestry sector’s carbon trade will be a primary driver of green economic development, food and energy security, and strengthen Indonesia’s commitment to addressing climate change. This aligns with President Prabowo Subianto’s Asta Cita vision of balancing economic growth with environmental sustainability,” Minister Antoni stated.
