Investment from private sectors is crucial for addressing Indonesia's massive sustainable finance deficit, worth trillions of dollars, as per insights from industry specialists due to escalating environmental impacts.
Jakarta, Indonesia - The Unlocking Capital for Sustainability conference, held on 24 June 2025, brought together over 100 decision-makers from government, finance, and industry to discuss Indonesia's ambitious sustainability goals and the strategies required to achieve them.
The conference, themed "Empowering change: financing Indonesia's green and blue economy," was organised by a website in partnership with the United Nations Environmental Programme Finance Initiative (UNEP FI). The event's partners included CDP, Energy Shift Institute, UN Global Compact Network Indonesia, TerraNova, Endeavor, and Singapore's Ambassador to Indonesia, Kwok Fook Seng, who delivered the closing address.
The conference's focus was on actionable initiatives to mobilize capital markets for sustainable development projects. Gita Sabharwal delivered the opening keynote address, setting the stage for discussions on Indonesia's sustainability financing gap and the need for a combination of national resources, public-private partnerships (PPPs), and increased domestic and private investments to address it.
The financing gap to meet the Sustainable Development Goals in Indonesia stands at US$1.7 trillion. The Asian Development Bank (ADB) estimates Asia's infrastructure and climate-adjusted investment needs exceed US$1.7 trillion per year, more than double previous estimates due to rapid growth and inclusion of climate-related investments. For Indonesia's clean energy transition, an estimated annual investment of around US$51.6 billion is needed.
PPPs are critical to bridging this financing gap. Effective PPP-related reforms, such as establishing PPP laws, streamlining procurement, and enabling dispute resolution mechanisms, can create an enabling environment for more private sector participation. Domestic investment and the private sector are indispensable because public finances alone cannot close the gap.
Mechanisms like carbon markets also offer potential by pricing emissions and providing financial incentives to unlock private capital. Platforms like the Energy Compact Action Network (ECAN) in Indonesia bring together government ministries, development finance institutions, private investors, and technology providers to align policy, capital, and project pipelines, helping convert policy ambitions into investment-ready projects.
The conference's second plenary focused on blue finance and tech, tapping into Indonesia's ocean economy for sustainable growth. The challenge is ensuring the right regulatory, governance, and financial mechanisms are in place to support the greening and blueing of the domestic economy. The closing plenary addressed unleashing AI for climate innovation and inclusion.
Indonesia's strategy to finance its green and sustainable development ambitions effectively involves significant scaling of private sector investments and domestic financial resources, enabling PPPs through regulatory and institutional reforms, innovative instruments like carbon markets to attract private capital, and coordinated efforts between government, private sector, and international partners to align investments with policy goals and develop investable projects.
Indonesia launched a first-of-its-kind sovereign blue bond to finance the sustainable use of marine ecosystems, and is targeting a 28% increase in new and renewable energy investments this year, at US$1.8 billion compared to 2024. The conversations at the conference are crucial in catalysing public-private partnerships to drive innovation in climate tech, clean energy, and sustainable ocean use. The event's full program can be viewed on the organizing website.
- The Unlocking Capital for Sustainability conference, held in 2025, focused on actionable initiatives to mobilize capital markets for sustainable development projects in Indonesia.
- Gita Sabharwal set the stage for discussions on Indonesia's sustainability financing gap in her opening keynote address, stating the need for a combination of national resources, public-private partnerships (PPPs), and increased domestic and private investments.
- PPPs are critical to bridging the US$1.7 trillion financing gap to meet Indonesia's Sustainable Development Goals, according to the Asian Development Bank (ADB).
- Mechanisms like carbon markets offer potential by pricing emissions and providing financial incentives to unlock private capital, as shown by initiatives like the Energy Compact Action Network (ECAN) in Indonesia.
- The conference's second plenary focused on blue finance and tech, tapping into Indonesia's ocean economy for sustainable growth, while the closing plenary addressed unleashing AI for climate innovation and inclusion.
- Indonesia's strategy for financing its green and sustainable development ambitions involves significant scaling of private sector investments and domestic financial resources, innovative instruments like carbon markets, and coordinated efforts between government, private sector, and international partners.
- Data-and-cloud-computing technology plays a crucial role in this strategy by providing the data needed to align investments with policy goals and develop investable projects.
- Personal-finance investments in renewable energy, clean tech, and sustainability projects can contribute to Indonesia's energy transition, presenting opportunities for individuals interested in making a positive impact on the planet and their personal portfolios. Additionally, sustainable travel, sports, and weather-resilient infrastructure can further contribute to Indonesia's green and blue economy.
