The Ministry of Trade is encouraging Indonesian business operators and exporters to enhance their understanding of carbon policies in export destination countries, particularly the European Union's Carbon Border Adjustment Mechanism (CBAM). By gaining a deep understanding, businesses can better navigate the impacts and necessary measures to maintain smooth trade, especially exports to the EU. A seminar titled “EU CBAM Policy: What Indonesian Businesses Need to Know?” was held on Thursday, October 10, 2024, at the Indonesia Convention Exhibition (ICE) in BSD City, Tangerang, Banten. This seminar was part of the 39th Trade Expo Indonesia (TEI) taking place from October 9 to 12, 2024. "This seminar aims to delve into the EU's CBAM policy, which has been gradually implemented since 2023. This policy covers sectors such as iron and steel, aluminum, cement, fertilizers, and energy, with potential expansions in the future. We hope this seminar becomes a productive forum where we can deepen our understanding of CBAM and jointly address these challenges with appropriate measures," said Johni Martha, Director of Bilateral Negotiations at the Ministry of Trade, during the seminar's opening.
One of the speakers, Brussels Trade Attaché Antonius Annurrullah Budiman, noted that the CBAM policy would impact at least three Indonesian export commodities: aluminum, iron and steel, and fertilizers. He explained the steps necessary for Indonesian products to comply with the regulations for entering the EU market, including carbon calculations and mandatory reporting for importers. Ferry Samuel Jacob, a Senior Trade Analyst at the Ministry of Trade, stated that the CBAM is an EU policy initiative to prevent carbon leakage risks and support the EU’s climate change mitigation ambitions. According to the Ministry's studies, this policy may negatively affect Indonesian exports, especially in the short and medium term, making it crucial for the government and businesses to take anticipatory actions. Meanwhile, Wahyudi Ali Adam, Deputy Director of Carbon Market Oversight at the Financial Services Authority (OJK), explained that Indonesia already has mechanisms and regulations for carbon trading through the carbon exchange. The regulations are outlined in Law No. 4 of 2023 on the Development and Strengthening of the Financial Sector (PPSK) and implemented through OJK Regulation No. 14 of 2023. The development of carbon trading is expected to help Indonesian businesses face challenges arising from partner countries' carbon footprint policies, including CBAM.
