Jakarta. A new facility has been introduced in Indonesia that will be used to promote economic development to stimulate green growth and improve rural livelihoods.
The Tropical Landscapes Finance Facility, consisting of a loan fund and a grant fund, aims to achieve climate targets set under the Paris Agreement. It will make public funding available to finance renewable energy production and sustainable landscape management.
"This ground-breaking and innovative financial platform, a world first, can transform the lives and livelihoods of millions of Indonesians in rural areas that deserve it the most," Tropical Landscapes Finance Facility steering committee chairman Dr. Kuntoro Mangkusubroto said in a statement on Wednesday (26/10).
Through sustainable production of agricultural commodities, the facility will scale up investment in renewable energy to assist the rural poor.
The Ministry of Environment and Forestry fully backs the facility as it falls in line with Indonesia's sustainable development aspirations.
"The Indonesian government realizes that we can only achieve the sustainable development goals through holistic policies, such as integrated landscape management," Coordinating Economic Affairs Minister Darmin Nasution said. "The facility aims to improve smallholder productivity while at the same time conserving our natural environment."
Along with the facility's steering committee, French bank and financial services company BNP Paribas and multinational investment manager ADM Capital will manage the loan fund.
"By joining in a partnership with the Tropical Landscapes Financing Facility in the capacity of capital markets and structuring adviser, BNP Paribas will help create innovative and collaborative financing mechanisms to bring private capital at scale and with good governance and risk management principles to fund long-term sustainable development projects," BNP Paribas Indonesia chief executive Luc Cardyn said.
The facility's secretariat will be managed by the United Nations Environment Program.
"The facility will trigger progress across several sustainable development goals, including saving the climate, protecting biodiversity and fostering renewable energy," UN Assistant Secretary General Elliott Harris said.