Indonesia's Development Strategy
The Indonesian government is pursuing a multisectoral transformation agenda guided by the principles of economic diversification, decarbonization, and structural inclusion:\
A nation and an emerging G20 economy. With over 17,000 islands, high biodiversity, a young population, and a growing industrial sector, Indonesia is a key strategic and emerging economy in the Asia-Pacific region.
At the same time, the country faces enormous challenges: rapid urbanization, massive deforestation, high emissions from land use, growing social inequality between urban centers and remote regions, and increasing climate risks due to rising sea levels, droughts, and floods.
Indonesia is in the process of transitioning from an extractive model to a sustainability-oriented development path. This transition is complex but crucial—for regional stability, global climate goals, and the livelihoods of over 275 million people.
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RPJPN 2025–2045 (Long-Term Development Plan)
Vision: Indonesia as a “developed, inclusive, green archipelagic nation” with a strong local economy, sustainable resource management, and digital transformation.
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NDC Implementation Roadmap & Low Carbon Development Initiative
Roadmap for achieving national climate targets by 2030 and net-zero emissions by 2060; integrating low-carbon planning into national budget and development strategies.
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Green Industrial Policy & Bioeconomy Strategy
Promoting renewable raw materials, the circular economy, and decarbonized value creation in sectors such as palm oil, textiles, aquaculture, biomass, and geothermal energy.
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New Capital City Nusantara (IKN)
An urban development project to build a climate-friendly, resilient new capital in eastern Kalimantan—as a symbol of sustainable national modernization.
These strategies combine economic ambition with social cohesion and environmental resilience—grounded in international sustainability commitments such as the 2030 Agenda and the Paris Agreement.
An Overview of the Challenges
Deforestation & Land-Use Conflicts
Indonesia is among the countries with the highest annual deforestation rates in the world—due to palm oil plantations, logging, and infrastructure development. Indigenous and local communities are affected by land expropriation, habitat loss, and conflicts.
Biodiversity Loss & the Illegal Economy
Many species—particularly in Sumatra, Borneo, and Papua—are threatened by habitat loss, poaching, and illegal trade. At the same time, there is a lack of capacity for monitoring, conservation, and reforestation.
Inequality & Gaps in Rural Infrastructure
While urban regions are experiencing dynamic economic growth, many islands and provinces—such as East Nusa Tenggara, Papua, and Kalimantan—remain underserved. Rural poverty exceeds 25% in some areas.
Global Alliances & Multilateral Cooperation
Just Energy Transition Partnership (JETP)
Indonesia is one of the first countries to sign a JETP agreement (worth $20 billion, involving Germany, Japan, and the United States, among others) aimed at accelerating the energy transition—with a focus on phasing out coal, expanding the grid, and promoting decentralized generation.
REDD+ and Biodiversity Financing
International partnerships with Norway, the Green Climate Fund, and multilateral actors promote the protection of tropical rainforests and the strengthening of indigenous forest governance.
ASEAN Cooperation & SDG Governance
Indonesia coordinates regional sustainability initiatives within ASEAN, maintains an active SDG platform, and operates a national SDG secretariat with links to subnational levels.
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