This action is taken to complement the earlier policy from the OJK that had formulated the Sustainable Finance Roadmap Phase II (2021-2025) that focuses on supply and demand development.
"From the supply development standpoint, OJK offers incentives, product innovation, and development of human resources' capacity," he remarked during the "Green Investment in Sharia Finance" webinar on Friday.
"Meanwhile, from the demand standpoint, the OJK intensifies its green finance national campaign, various real programs' support, and green certification to companies," he stated.
OJK also provides incentives to both financial consumers and institutions in the banking sector, capital market, and non-bank financial industry to develop green finance.
These incentives encompass reduction of banking Risk-weighted Asset (RWA), 50-percent discount for green bond annual recording tariff from the Indonesia Stock Exchange, and 50-percent relaxation of risk weight for financing distribution companies.
As a form of support to the development of the green economy, OJK has issued the Indonesia Green Taxonomy book in 2022.
This makes Indonesia as one of the few countries in the world to have a national standard for green economy in addition to China, the European Union, and ASEAN.
Green Taxonomy included within the Sustainable Finance Roadmap Phase II (2021-2025) for the financial service sector will serve as a guideline for the formulation of policies, including incentive provision, from various ministries and institutions, including the OJK.
The formulation of Green Taxonomy is part of the government's policy to meet the Paris Agreement's target, he remarked.
Under the agreement, Indonesia has set a target to reduce carbon emissions by up to 29 percent through its own efforts and 41 percent with international support by 2030.
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Translator: Sanya Dinda S, Fadhli Ruhman
Editor: Rahmad Nasution
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