Indonesia is set to finalize a bilateral agreement with Japan aimed at enhancing carbon trading between the two nations, according to the Southeast Asian country’s Vice-Minister for Environment and Forestry. During a visit to Tokyo, he informed Nikkei Asia, a Japanese trade platform, that the two nations would sign a Mutual Recognition Agreement (MRA). The vice-minister also met with Japan’s Environment Ministry officials to discuss aligning the two countries’ emission-reduction certification systems—Indonesia’s SPEI and Japan’s Joint Crediting Mechanism (JCM)—regarding methodologies and registry systems.
Indonesia and Japan are already exploring potential carbon credit-generating projects involving government bodies and private enterprises. Among these initiatives is a collaboration with Japan’s Sumitomo Forestry, which is engaged in a peatland restoration project in Central Kalimantan, Indonesia. This project highlights the growing cooperation between the two nations in environmental sustainability efforts.
The vice minister stressed that carbon trading schemes are part of Indonesia’s strategy to achieve carbon neutrality by 2060. He highlighted the need for strong commitments from developed countries, including financial support, technology transfer, and capacity building. The discussions between Indonesia and Japan are happening in the context of global talks on international carbon trading, enabled by Article 6 of the Paris Agreement. This article allows countries to collaborate by creating and trading carbon credits across borders, facilitating global emissions reductions.
The vice minister mentioned that Indonesia will present its bilateral carbon trading framework with Japan at the 29th United Nations Climate Change Conference (COP29) in Azerbaijan in November 2024. He explained that bilateral agreements effectively demonstrate the feasibility of Article 6 of the Paris Agreement. Bilateral deals are more straightforward to finalize than multilateral discussions, making them a “quick strategy” to showcase practical implementation to other member states.
(Source: Nikkei Asia)