Indonesia

AFD, the French Development Agency, has been working in Indonesia for more than 10 years to promote green and inclusive development. We finance the initiatives of the Government of Indonesia, public banks, companies and NGO’s and provide technical assistance. Our objectives: to support both Indonesia’s international commitments on reducing greenhouse gas emissions and to ensure economic and social development of the country.
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Fisherman in Palu, Indonesia
AFD and Indonesia: Striking a balance between growth and respect for biodiversity
Fisherman in Palu, Indonesia

Promoting renewable energy and energy efficiency

Hydropower plant in Indonesia

PROMOTING RENEWABLE ENERGY AND ENERGY EFFICIENCY

With the increase of the population and the development of the country, the needs of Indonesia in terms of power generation, transmission and distribution are huge. Public and private investments in the energy sector in renewable energy (geothermal, solar, wind, hydropower) and energy efficiency (building, transportation) will stimulate the development of the country and support the efforts of the Indonesian Government’s efforts to achieve the objectives of the Paris Agreement.

AFD finances investments and reforms in renewable energy and energy efficiency through development policy loans, direct loans to the public electricity company (PLN), and through dedicated credit lines to local banks supporting private or public investors. PROPARCO provides equity and debt to private companies in the sector. 

Improving urban public services

Railway line Banjar-Bandung, Indonesia

IMPROVING URBAN PUBLIC SERVICES

The rapid demographic and spatial expansion of Indonesian cities has created significant investment needs in urban public infrastructure.


AFD supports public investments in centralised water and sanitation systems in Indonesia’s main cities, considering that they improve people’s living conditions and protect the environment through water-saving and depollution. The Agency also supports public investments in urban public transportation systems (bus, light train, metro…) in order to offset the rapid growth of private cars in Indonesia. Such projects will generate economic benefits and positive environmental impacts, in particular improved air quality and lower greenhouse gas emissions. Likewise, AFD will support public investments in solid waste management services such as collection and recycling for cleaner cities.


The Agency will also back the efforts of the Indonesian Government and cities in implementing sustainable urban planning practices.

Sustainable management of natural resources

Satellite for real-time oceanographic observation and analysis, Indonesia

AIMING SUSTAINABLE MANAGEMENT OF NATURAL RESOURCES

Indonesia is the largest archipelago in the world and has a vast maritime territory, made up of over 17,000 islands and probably the most important reservoir of marine and forestry biodiversity on the planet. Indonesian waters represent several billion dollars of annual revenue through fisheries, aquaculture, transport and tourism. However, these resources are exposed to illegal fishing, global warming, pollution and coastal deforestation.


To support the Indonesia Blue economy, AFD contributes to public investments in natural resource management (sustainable fisheries, mangrove protected areas) through dedicated supports to national agencies such as the Meteorological, Climatological and Geophysical Agency (BMKG), the National Institute of Science (LIPI), as well as the Ministry of Fisheries and its entities. 

Enhancing maritime connectivity

The spatial oceanographic center to fight against illegal fishing and protect coral, Indonesia

DEVELOPING A BETTER MARITIME CONNECTIVITY

Given the country’s geographical situation, the transport and maritime sectors are key elements of the Indonesian economy. In 2014, the Indonesian government adopted a maritime development plan in the five-year development plan (RPJMN) 2015–2019 aimed at improving the sector’s performances.


AFD supported the reforms undertaken by the Indonesian Government through development policy loans and technical cooperation between the Indonesian and French port authorities. AFD also finances public investment in maritime ports through sovereign and non-sovereign loans.

Supporting public finance efficiency

Indeso marine center

PROVIDING SUPPORT FOR THE EFFECTIVENESS OF PUBLIC FINANCES

In order to increase domestic financial resources for development and its financial performances, Indonesia has launched major reforms.


AFD supported the reforms undertaken by the Government of Indonesia through development policy loans and technical cooperation between the Indonesian and French tax administrations.

2.2
billion committed in 10 years
54
operations financed since 2008
4
major policy reforms supported

Indonesia is one of the fastest-growing economies in Asia and the world’s fourth most populous country (262 million inhabitants). The country has recently established democratic institutions, which make it highly attractive to foreign investors. However, the archipelago is faced with a lack of infrastructure and a high poverty rate.

The Indonesian archipelago is located in the heart of the Indian Ocean and is made up of over 17,000 islands. With its 50,000 km of tropical coastlines and half of its surface area covered by forests, Indonesia is a biodiversity hotspot. This biodiversity is threatened by human activity and climate change. 

Indonesia has set out on the path of sustainable development while strengthening its political and financial good governance. 

AFD has been operating in Indonesia since 2007. It was initially involved in “post-tsunami” action and today supports more inclusive and environmentally friendly growth.

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Asia and Pacific | Indonesia

Indonesia: Fishermen Back On Their Feet after the Tsunami

The tsunami that hit hard in part of Indonesia in September 2018 destroyed their boats. Today, many fishermen in Palu, on the island of Sulawesi, only survive through humanitarian aid. But thanks to the project to revive the local economy and protect against natural disasters, funded by Agence française de développement (AFD), some are already returning to sea. Here is a report from Palu, in the centre of the island.

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