ADFIAP, through the ADFIAP Consulting Group (AC), has been tapped by the Gesellschaft fuer Internationale Zusammenarbeit GmbH (GIZ) Indonesia under its Regional Economic Development (RED) Program, to develop a green finance training curriculum and customized modules for Indonesian financial institutions and to pilot the training to two Indonesian regional banks, namely, Bank NTB in Mataram, Lombok and Bank Sumut in Medan, Sumatera Utara as well as to enhance the capacity of its national service provider, the Indonesian Banking Development Institute (LPPI), to eventually replicate the training to other banks in Indonesia.
Indonesia has voluntarily committed to reducing greenhouse gas emissions by 2020. This commitment ranges from 26% based on so-called “business as usual approach” to up to 41% with international support. To initiate a green transformation, the Government of Indonesia is developing a framework that will provide incentives for a more efficient use of resources and increased investment in sustainable and energy efficient ventures. While banks have signified support towards the Government’s green transformation, the lack of know-how on green financing appears to be a significant obstacle in pursuing this direction. The GIZ-RED Program in Indonesia is addressing this challenge and is offering to improve the readiness of banks to pursue this new challenge through the Green Finance Program, which will be piloted in two regional banks and subsequently rolled-out to other Indonesian banks. The Financial Services Authority (OJK), which is cooperating with the GIZ-RED Program, has declared its interest in the green finance training since it provides capacity building for Indonesian banks on a regular basis.
As a first step, a 2-week (September 29 to October 11, 2014) stocktaking and assessment mission was conducted in Indonesia by AC’s Ms. Cora D. Conde and Mr. Vic C. Abainza. Together with GIZ’s Adviser for Green Economy, Mr. Glenn Manday and LPPI’s Senior Faculty, Ms. Elis Mudjiwati and Mr. Trioksa Siahaan, the stocktaking team held meetings with officials of Bank Indonesia (Central Bank), the Financial Services Authority of Indonesia (OJK), USAID, UNIDO, IFC, Ministry of Environment, Bank NTB, Bank Sumut and Sparkassenstiftung fur Internationale Kooperation to present the Green Finance Program and gather feedback on how to improve the readiness of Indonesian banks to increase their competitiveness in providing green financial services.
The ADFIAP Consulting training team is scheduled to go to Indonesia on November 9-22, 2014 to pilot the green finance training program to Bank NTB and Bank Sumut. The training program will thereafter be evaluated and enhanced, if needed, before the Indonesian training partner, LPPI, will roll-out the same to other Indonesian banks. ADFIAP, through this green finance training program, envisions to play a significant role in empowering Indonesian banks to support the green transformation movement of their government in pursuance to one of its pillars, the environment.