The carbon market represents a strategic intersection of environmental and economic interests and is a relatively new and evolving concept. It presents a promising prospect for the world to develop a resilient ecosystem, where businesses can reap benefits from their efforts to restore the environment through mitigation and adaptation strategies. This White Paper aims to illuminate the intricacies of the carbon market concept, highlighting the global momentum that is positioning Indonesia as a key player in pioneering the establishment of a robust carbon market in the region. The paper has provided a comprehensive overview of Indonesia’s current position in this context, followed by an examination of notable benchmarks and best practices, as well as an in-depth analysis of the existing regulatory and economic infrastructure in supporting the carbon market created in the country.

Indonesia’s carbon market is strategically positioned, boasting abundant green resources and a strong industrial sector. The nation is committed to establishing a robust ecosystem for supply and demand chains in primary and secondary carbon markets. To achieve its NDC goals, Indonesia must continue to build on these efforts. This White Paper offers valuable insights derived from several benchmarks, emphasizing industry cooperation, financial sector collaboration, cross-provincial engagement, and strengthening the VCM facility to advance the nation’s carbon market initiatives for a more sustainable future over the next decade.