Indonesia is a biodiversity-rich nation with vast natural resources, including extensive coastal ecosystems, tropical rainforests, and rich agricultural lands. These natural resources play a pivotal role in addressing climate change through nature-based solutions (NBS) that enhance ecosystem resilience while reducing greenhouse gas emissions. Indonesia’s leadership in the Agriculture, Forestry, and Other Land Use (AFOLU) sector, coupled with its commitment to integrating blue carbon ecosystems, such as mangroves and seagrass beds, into climate mitigation strategies, positions the country as a key player in global carbon markets.

The National Blue Carbon Action Partnership and the blue carbon framework are key components of Indonesia’s strategy to harness the potential of its coastal and marine ecosystems. With over 3 million hectares of mangrove forests, Indonesia is home to one of the world’s largest blue carbon sinks, and projects such as Mangrove for Coastal Resilience exemplify how ecosystem restoration and conservation can not only mitigate climate impacts but also support biodiversity, livelihoods, and coastal protection.

The business-to-business (B2B) carbon market for the forestry and land use (FOLU) sector is gaining momentum as companies increasingly seek to offset their emissions. This market includes voluntary and regulated carbon credits, with a particular focus on nature-based solutions like forest conservation, reforestation, and sustainable land management.

Nature-Based Solution are particularly effective because they harness the ability of ecosystems to absorb carbon dioxide, regulate water cycles, and provide habitat for wildlife, while simultaneously supporting human livelihoods. Unlike traditional engineering solutions, nature-based approaches often provide multiple benefits, including enhancing ecosystem resilience, improving community well-being, and promoting sustainable development.

In Indonesia, the FOLU Net Sink 2030 initiative plays a critical role in reducing emissions by leveraging forest carbon potential. The government has partnered with businesses and civil society to achieve significant progress in mitigating deforestation and promoting carbon sequestration projects. This collaboration is fostering opportunities for B2B carbon credit transactions, with many corporates looking to offset their emissions by purchasing high-quality credits generated from forestry projects in Indonesia.

On the other aspect, the transition to a low-carbon economy presents opportunities for growth, innovation, and leadership; however, it also raises critical questions about equity and inclusiveness, particularly in sectors with high carbon intensity, such as the shipping industry and energy production.

The shipping industry, which plays a vital role in Indonesia’s economy, must also undergo decarbonization. The development of green ports is a crucial part of this transformation.

This session will explore how Indonesia is channeling its best practices in nature-based solutions and AFOLU projects into the carbon market; and Indonesia’s actions to ensure a just and equitable transition, particularly in sectors like shipping and energy. It will focus on the potential for blue carbon projects to contribute to climate action, the role of carbon project developers in scaling these efforts, and how international carbon markets can unlock financing for sustainable development and ecosystem preservation.