World Bank adds $200m to Indonesian environmental efforts

The World Bank has approved a $200m (£139m) loan to the government of Indonesia to support its climate change policies.

The bank said in a statement that the Climate Change Development Policy Loan programme will help the Indonesian government to address the need to mitigate greenhouse gas emissions; enhance adaptation and resiliency to the effects of climate change; and strengthen government institutions in implementing and enforcing its climate change policy agenda.

The loan will be split into three equal shares among Indonesia’s agriculture, fishing and forestry sector; the energy and mining sector; and the government’s public administration, law and justice departments. The cash is envisioned as a series of four annual single tranche loans of similar size anchored to the FY09-FY12 Country Partnership Strategy and running over 24.5 years.

Indonesia is the world’s third-largest emitter of greenhouse gases behind China and the US. Earlier this year the government pledged to kick-start a $1bn environmental fund.

As home to a large proportion of the world’s rainforests, prey to illegal logging, Indonesia’s response to climate change is of global concern. Indeed, last year Indonesia became the first country to launch a legal framework for the UN-backed Reducing Emissions from Deforestation and Degradation programme.

But further impacts from rising sea levels and changing weather patterns include increased threats to food security and agricultural productivity; impacts on coastal zones and community livelihoods; consequences for water storage; intensification of water- and vector-borne diseases; and deterioration of coral ecosystems.

“An approach that increases adaptive ability, builds community resilience and increases preparedness for managing disasters makes economic sense for Indonesia, a kind of insurance,” said the bank's statement.