🌿 Blended Finance for Indonesian Social Forestry
Last week, I had the honor of representing Lembaga Alam Tropika Indonesia [LATIN] at a workshop organized by Badan Pengelola Dana Lingkungan Hidup (Indonesian Environmental Fund), the Ministry of Finance, where I provided insights on the blended finance scheme for social forestry in Indonesia. This workshop allowed us to share the implementation strategies and lessons learned from the blended finance initiatives developed by LATIN and Jejakin through the Kanaya Fund | Climate Finance Model.
The key points of our discussion included:
1. Blended finance is a financing scheme for “structuring” that mobilizes additional private capital by mitigating project risks using public or philanthropic capital as a catalyst.
2. This approach presents a viable solution to bridge the financing gap and expedite the development of sustainable social forestry.
3. It is essential that blended finance schemes should, by design, stimulate private interest in green investments within social forestry while simultaneously empowering social forestry groups as multi-business forestry actors, whether they focus on product/commodity-based initiatives or environmental services. Ensuring robust market networks is a critical requirement.
4. Each social forestry location or landscape (Integrated Area Development – IAD) should have a well-defined business model and green investment plan, simplifying investment considerations for the private sector.
5. Free, Prior, and Informed Consent (FPIC) and safeguard measures are vital for fostering trust among business stakeholders.
6. Technology is crucial in developing a Monitoring, Reporting, and Verification (MRV) system to ensure that investment objectives are achieved.
*My sincere gratitude to LATIN and our partners at Jejakin for our two-year journey in building the Kanaya Fund platform.
*I would also like to thank ANGIN Advisory particularly Saskia Tjokro and her team, for making this opportunity possible.
cc: Haris Iskandar Farah Sofa
hashtag#blendedfinance hashtag#climatefinance hashtag#climateaction hashtag#esgsolution hashtag#carbonoffset
