Lahadalia explained that the ministry is the designated institution to carry out the registration and certification of carbon trading prior to conducting carbon trading on the carbon exchange.
"It has been decided that carbon (trading) in Indonesia is open, but it must be registered and everything must go through a trading governance mechanism on the carbon exchange in Indonesia," Lahadalia stated after a Limited Carbon Trading Meeting at the Merdeka Palace here on Wednesday.
He explained that carbon trading governance is carried out on carbon exchanges. It will be supervised by the Financial Services Authority (OJK).
The OJK is still preparing mechanisms and regulations, including waiting for tax imposition provisions related to carbon exchanges.
To enter the carbon exchange, business actors must register with KLHK. Lahadalia said registration is only done once.
"After trading on the carbon exchange, they can trade like ordinary stock trading," he stated.
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Indonesia is said to have a large enough carbon market potential.
With the third-largest tropical forests in the world spanning an area of 125 million hectares, Indonesia has huge potential to lead the carbon market that is estimated to be able to absorb 25 billion tons of carbon.
Carbon trading is one way to control carbon emissions in a country.
The Indonesian government has set a target in the 2030 Nationally Determined Contribution (NDC) as well as net zero emissions (NZE) or zero emissions by 2060.
In the NDC document, Indonesia is targeting to reduce emissions by 31.89 percent through its own efforts and by 43.20 percent with international support by 2030.
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Translator: Mentari Dwi Gayati, Katriana
Editor: Yuni Arisandy Sinaga
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