- Government Restructuring Indicates Shift in Fiscal and SOE Governance
In September and October 2025, the Indonesian government confirmed significant leadership changes and institutional reforms. The first cabinet reshuffle on 8 September resulted in the departure of Finance Minister Sri Mulyani Indrawati, who had played a central role in promoting green fiscal policy and international climate-finance cooperation. Further Ministers and government officials were replaced throughout the two sequences of leadership changes.
A broader reform of the state-enterprise sector followed a second reshuffle on 17 September. The Fourth Amendment to Law No. 19/2003 on State-Owned Enterprises, adopted on 2 October, led to the dissolvement of the former Ministry and replacement by the State-Owned Enterprises Regulatory Agency (Badan Pengaturan BUMN – BP BUMN). The regulatory and governance functions now rest with BP BUMN, while Danantara Indonesia, including major entities such as PLN and Pertamina, manage operational and investment responsibilities. On 8 October, President Prabowo Subianto appointed Dony Oskaria as Head of BP BUMN through Presidential Decree No. 109/P/2025.
Source: Jakarta Post, Tempo, October 8, 2025
- Renewable Power Generation Surpasses Coal for the First Time Globally
In the first half of 2025, renewable energy sources have produced more electricity than coal worldwide. Data by the think tank Ember underscore that solar and wind generation rose sharply in the first half of 2025, which marks a relevant milestone in the global energy transition. China and India contributed most to the increase, while coal use remained stable or declined in many advanced economies.
Source: BBC, October 7, 2025
- Study Finds Persistent Weaknesses in Global Carbon Offset System
A review paper published in October 2025 found that many voluntary carbon offset schemes fail to meet their climate claims. The study highlights systemic flaws, including challenges with baselines, double counting, and a lack of additionality. The authors argue that technical adjustments alone will not be sufficient and call for a structural reform of international offset markets to ensure measurable climate impact.
Source: Guardian, October 6, 2025
- Indonesia–UK Launch National Parks and Social Forestry Programs
On August 30, 2025, Indonesia and the United Kingdom jointly launched two initiatives to promote conservation and community forestry. The Nature Transition Support Programme (NTSP) was initiated to save biodiversity in the three national parks of Way Kambas in Lampung, Tanjung Puting and Sebangau in Central Kalimantan. The NTSP enables governments to protect these areas while producing carbon and biodiversity credits that finance conservation efforts and support local populations.
Source: GGGI, 30 Aug 2025
- Disaster Pooling Fund
The Indonesian government has established a Disaster Pooling Fund (PFB), a crucial component of the disaster risk financing strategy it has initiated. As part of disaster risk mitigation efforts, the PFB plays a role in providing rapid and efficient financial support for disaster management. To increase public understanding and awareness of the existence and function of the PFB, the National Disaster Management Agency (BNPB) collaborated with the Environmental Fund Management Agency (BPDLH) and the Directorate General of Economic and Fiscal Strategy (DJSEF) of the Ministry of Finance to hold a socialization event on Disaster Funding Innovation on September 10, 2025.
Source: Ministry of Finance, 10 Sept 2025
- Indonesia and EU Conclude Landmark Trade Deal
Indonesia and the European Union finalized negotiations on a Comprehensive Economic Partnership Agreement (IEU-CEPA) on September 23, 2025, after nearly a decade of talks. The agreement – the EU’s third with a Southeast Asian nation (after Singapore and Vietnam) – will eliminate import duties on over 90% of goods once in force, thereby boosting trade and investment. Contentious issues like palm oil and deforestation standards were addressed, including a dedicated protocol on sustainable palm oil. Indonesia’s House of Representatives must now ratify the trade agreement. Equally, each EU member state will have to ratify the trade agreement separately.
Source: Reuters – 23 September, 2025
- Revision of President regulation will open the Private Sector Participation
The Indonesian government, led by the Ministry of Environment, is opening opportunities for private sector participation in forestry climate financing through voluntary carbon markets (VCM). The current revision of Presidential Regulation No. 98/2021 on carbon economic value (Nilai Ekonomi Karbon, NEK) is conducted to enable greater private sector investment in forestry-based carbon markets. The revision focuses on strengthening oversight and ensuring that carbon credit originates from legally managed forests that are free of conflict.
Ilham, Director of Forest Utilization Business Development, stated that the revised regulation will serve as a legal basis for Standard Operating Procedures (SOPs) governing voluntary carbon trading in the forestry sector, including community forests and conservation areas. He reiterated that carbon credits linked to forest utilization permits or social forestry must be assessed carefully to avoid areas of potential dispute or double-counting.
Source: Ecobiz, Antara, September 27, 2025
- ASEAN-EU Ministerial Dialogue on Environment
which took place on September 3–4, 2025, at Langkawi, Malaysia, EU and ASEAN officials agreed on a plan to work together to deal with plastic pollution as a shared priority. Their endorsement of a joint EU and ASEAN press statement on climate change for the next COP30 encompasses a pledge to intensify efforts related to marine plastic pollution, circular economy initiatives, and transboundary waste management collaboration. In addition, the EU and ASEAN agreed to deepen their collaboration on bioeconomy as a means of combining economic growth potentials and sustainable development.
Source: ASEAN, 4 Sep 2025
- Blue Food Assessment and Index Drive “Blue Economy” Agenda
The Ministry of National Development Planning (Bappenas) released a Blue Food Assessment (BFA) and the country’s first Blue Economy Index (IBEI) in Jakarta on August 6, 2025. The BFA provides a comprehensive analysis of Indonesia’s marine and aquaculture food sectors to inform evidence-based policy on blue foods. The IBEI is a new tool to measure progress in developing a sustainable blue economy. Speaking at the launch, Marine Affairs and Fisheries Minister Sakti Wahyu Trenggono highlighted plans to expand marine protected areas to 97.5 million hectares by 2045 as part of Indonesia’s Blue Economy strategy.
Source: EU Delegation to Indonesia (EEAS), 6 Aug 2025
