Indonesia is aiming for a strategic position as a major player in the Asian carbon market, in line with the significant growth in domestic carbon transactions throughout 2025. Through the launch of international carbon trading in early 2025, the Indonesia Stock Exchange (IDX) is targeting strengthening regional competitiveness, particularly in the face of the dominance of Japan and Malaysia. Ignatius Denny Wicaksono, Head of Business Development Division 2 at the IDX, stated that Indonesia's potential lies in the supply of carbon credits from the forestry, energy, and fertilizer sectors, as well as the regulatory support currently being strengthened by the government. "By accelerating project registration and improving regulations, Indonesia can become a carbon hub in Southeast Asia," Denny said on Monday (August 25th, 2025).
IDX data shows that carbon transactions through the IDXCarbon platform reached 699,000 tons of CO₂ equivalent, valued at IDR 29.6 billion, as of August 2025, a 493% increase compared to the same period last year. This figure is still far below Japan's, but higher than Malaysia's, which has only recently started operating a limited-scale carbon exchange. Despite the bright prospects, several challenges remain, such as the slow validation of forestry projects, the lack of fiscal incentives, and relatively high domestic carbon prices compared to neighboring countries. According to him, Indonesia's opportunities are not limited to the regional level, but also as an exporter of carbon credits to global registries like the Gold Standard and developed country markets. "Our key lies in accelerating projects and harmonizing regulations. The market already exists; it's just a matter of how we become more competitive," he emphasized.
