Indonesia resumes int’l carbon trading after 4-year hiatus

Indonesian President Prabowo Subianto has issued a new decree to restart international carbon emissions trading after a four-year hiatus.

The Southeast Asian country issued carbon market rules in 2021 that focused on compliance carbon markets rather than transactions in voluntary markets.

The rules effectively put an end to all cross-border carbon emissions-credit trading, including those generated from big projects such as the Katingan Mentaya conservation project.

Indonesia said the moratorium allowed the country to prioritize meeting its own greenhouse gas reduction targets rather than selling the reductions overseas, especially amid concerns that carbon prices were too low and that selling countries were not benefiting from the market.

The new presidential decree allows international trade in carbon-offset units to resume in accordance with Indonesian national standards, or with standards set by the United Nations Framework Convention on Climate Change and other international certifiers.

The decree also calls for the establishment of a decentralized registry for carbon units that will be transparent and run in real time to prevent the double counting of carbon emissions reductions.

President Prabowo plans to generate capital inflows from sales of carbon offsets to foreign buyers through projects such as rainforest preservation.

In 2025, Indonesia has signed mutual recognition agreements with international organisations that certify projects that cut greenhouse gas emissions, including Verra, Gold Standard, Global Carbon Council, Plan Vivo and the Joint Crediting Mechanism.

These deals are expected to facilitate international carbon trade and foreign investments to support Indonesia’s climate goals.