On 7-8 July 2017, the G20 Summit will be held in Hamburg, Germany. The forum, which consists of 20 member countries, will discuss important issues in the world economy, including climate change. The G20 countries, producing 85% of the world’s gross domestic product (GDP), are responsible for 75% of global emissions.
Ahead of this meeting, the world’s civil society members of Civil20 (C20) formulated input, delivered to the President of the G20, Angela Merkel, Chancellor of Germany. The issue of climate change and threats to sustainable development is the primary input besides fair finance.
In Indonesia, the Civil Society Forum for Foreign Policy also formulates attitudes and input to the Government of Indonesia and the countries that are members of the G20.
Yesi Maryam, Outreach Officer of the Institute for Essential Services Reform (IESR), said, based on the 2017 Brown to Green Report launched by Climate Transparency earlier this week, the G20 countries are starting a transition to a low-carbon economy.
However, she said, these efforts have been prolonged to prevent an increase below the two degrees Celsius target of the Paris Agreement.
She gave an example of Indonesia, which has set a target for reducing greenhouse gas emissions by 2030. Unfortunately, this has not been in line with the target of the Paris Agreement.
Sectoral policies are deemed not good enough and lack a long-term emission reduction strategy. Although Yesi said, it was quite successful in reducing fossil fuel subsidies, support from public funding instruments for renewable energy was minimal.
The attractiveness of renewable energy investment, said Yesi, is very low compared to other G20 countries. Thus, IESR asked President Joko Widodo at the G20 Summit to strengthen the Indonesian economy in line with the Paris Agreement.
“Pushing for reducing greenhouse gas emissions from the forestry, peatland, and renewable energy sectors is more ambitious by 2020.”
Based on the trend, if the G20 countries continue to do business as usual, it is estimated that global temperatures will rise by three to four degrees, as stated in the Brown to Grown Report 2017: The G20 Transition to Low Carbon Economy.
This report is published by the Climate Transparency Consortium consisting of institutions and experts from several G20 countries, i.e., Mexico, South Africa, Australia, England, Indonesia, Argentina, Brazil, China, India, Germany, and France. Institutions that are members of this consortium include the Overseas Development Institute (ODI), IESR, Climate Action Tracker (CAT), Climate Change Performance Index (CCPI), HumboldtViadrina, New Climate Institute, and Germanwatch.
“The main message in this report is that the G20 countries have been decarbonizing, but not fast enough to meet the targets of the commitments in the Paris Agreement,” said Fabby Tumiwa, Executive Director of IESR.
In 1990-2014, the G20 countries’ greenhouse gas (GHG) emissions increased by 34%, with 117% economic growth. This report is also a recommendation to encourage the government to make policies that support renewable energy development.
Unfortunately, the development of renewable energy is still far behind compared to the G-20 member countries. This study describes the reasons for low carbon investment’s attractiveness due to the uncertain quality of regulatory frameworks, funding, and decarbonization efforts.
He said that Indonesia has relatively high renewable energy potential, but it is significantly lagging. He gave an example; the action was contrary to the Paris Agreement in reducing emissions with the government’s plan to rely on coal energy.
In the last five years, Fabby said that Indonesia still relied on fossil fuels, especially oil and coal. Meanwhile, other G20 member countries have fled to renewable energy.
In line with Yesi, Fabby said, Indonesia had efforts to reduce fossil energy, but it needed progressive strategies, plans, and policies to transition to a low-carbon economy.
Based on the research institute Renewable Energy Country Attractiveness Index (Recai), the attractiveness of Indonesia’s renewable energy investment is not good. In October 2016, Indonesia was ranked 38 out of 40 countries, but in May 2017, Indonesia was no longer there.
“This is because the regulatory framework for renewable energy is still under several G20 countries, and the ever-changing regulations make investment unsafe,” said Fabby.
Nur Masripatin, Director General of Climate Change, Ministry of Environment and Forestry, said that the ministry has pushed for policy instruments such as establishing a Public Service Agency (BLU) to manage environmental funds. This Public Service Agency could convince investors to invest, including renewable energy.
Nur said this Public Service Agency is a financial institution that finances efforts to reduce carbon emissions and environmental protection activities.
However, before the draft Perpres is signed, the Ministry of Environment and Forestry must finalize a draft government regulation (RPP) on Environmental-Economic Instruments, a derivative of the Law on Environmental Protection and Management. “It is still a process; we ask it as soon as possible. It is important.”
Policies Must Be Clear
Arief Wijaya, WRI’s Senior Manager of Forests and Climate, said that the government needs to formulate policies and action plans to facilitate renewable energy investors to be attracted to Indonesia.
“There needs to be a clear commitment from state leaders and decision-makers to understand renewable energy sources,” he said, saying, at least, the policy could balance fossil and renewable energy.
Sustainability Report
The forum also highlighted the ongoing reporting obligations. Jalal, Advisor for Indonesia’s Transparency for Justice (TuK) Finance Policy, said TuK demanded that the Indonesian government oblige sustainability reporting immediately.
“Very clearly, companies around the world tend to cover up the negative impacts of their operations. It is not the time for companies to ignore their economic, social, and environmental impacts,” Jalal said at a press conference in Jakarta Thursday (6/6/17).
Large companies, especially those that are members of the Indonesia Stock Exchange, must comprehensively report their sustainability policies, programs, and performance.
So far, he said, reporting obligations for companies listed on the Indonesia Stock Exchange (IDX) are still careless and very lax.
The obligation to report, said Jalal, is followed by strict supervision and clarity of its economic, social, and environmental obligations. It would change the practices of companies operating in Indonesia and the world.
He said the government could also make firm regulations and create a system of incentives for companies that lead to sustainability and disincentives for those contrary to sustainability.
“Companies must be responsible for these impacts. Now many confess, actually brainwashing. Caring but most damaging to the environment, ” Jalal said.
Besides, the focus of these countries must be on sustainable finance. “Our time is short until 2030 to save ourselves from climate change.”
One of the stakeholders whose behavior needs to change the most is financial service institutions.” It is time for public and private funding to be weighed with a firm measure. What helps achieve the SDGs goals and the Paris Agreement is what is being funded. The two of them immediately need to be put on the negative list and not financed. ”
Maryati Abdullah, National Coordinator for Publish What You Pay (PWYP) said, Indonesia and the G20 countries need to ensure extractive companies comply with international standards in sustainable development. Ensuring they pay attention to human rights, the environment, transparent and accountable governance, and workers’ rights.
Rashmi Hertanti, Executive Director of Indonesia for Global Justice (IGJ), highlighted protectionism through reform of international trade and investment policies that must be addressed carefully.
She gave an example, various domestic policies to increase competitiveness are vulnerable to being sued through international arbitration courts. For example, the Indonesian government limits concentrated exports to strengthen the downstream industry, protested, and sued many countries.
The civil society forum for foreign policy, among others, consists of IESR, Migrant Care, Prakarsa, Walhi, PWYP, and TuK Indonesia, expressing support for the conclusion of the C20 recommendation at the meeting in Hamburg, 19 June 2017. The recommendations include the urge to stop the environment’s treatment; oceans and atmosphere are like an endless dumping ground for various pollution and greenhouse gases.
Also, implement the Paris Agreement immediately with an ambitious long-term climate strategy, eliminating fossil fuels, setting an effective and fair carbon price signal. Then, shift financial flows to promote transformation from resilience and stick to promises to increase climate costs.
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This summit will be the first meeting of global leaders since Donald Trump, the United States President, declared his withdrawal from the Paris Agreement.
Andrew Light, Distinguished Senior Fellow, Climate Program, WRI Global, said the G20 would show how other countries are sending strong signals to support the Paris Agreement, despite US doubts.
“Many parties support Germany, as the host of the G20, to have comprehensive statements in support of the Paris Agreement and Sustainable Development Goals, development of renewable energy and energy efficiency,” he told Mongabay.
Previously, the US had announced NDCs, reducing emissions by 26-28% by 2025, with firm commitments coming from significant states such as New York and Washington DC. “The administration has a decision that Trump can reverse some of the existing climate-related policies.”
Arief added that Indonesia must play a more vocal role in the G20 negotiations. “It is time for us to demonstrate an important and unique position in the G20 from an environmental point of view.”
Indonesia, he said, has significant tropical peatlands, has the third-largest rainforest in the world.
He hopes that the President can deliver messages that have a good impact on handling climate change, for example, messages about Indonesia’s investment and development in renewable energy and how Indonesia encourages environmentally-friendly industries.
Furthermore, WRI hopes that the Indonesian delegation can bring a concrete action plan from NDC to the sustainable development, climate, and energy sector. “More importantly, thinking about sustainable development must be the basis for every decision and policy that is made,” he said.