Pembangunan Jangka Menengah Bidang Politik: Tantangan, Isu

Green Economy and Sustainable Development
in Indonesia
Prof. Dr. Armida S. Alisjahbana
Fakultas Ekonomi dan Bisnis – Universitas Padjadjaran
Kongres Ke-3 AFEBI
Pontianak, 19 November, 2015
Outline*
1. From MDGs to Sustainable Development Goals
2. Sustainable Development in Indonesia: An Unfinished Agenda
3. Framework for Priority Policies and Strategies
4. Green Economy and Sustainable Development
5. Implementation and Priority Issues
*Modified from presentation to the Asia Pacific Forum on Sustainable Development, UN-ESCAP, Bangkok, May 2015.
Materi yang sama disampaikan sebagai bahan Visiting Lecture di GRIPS dan Universitas Takushoku, Tokyo, Oktober,
2015.
2
1. From MDGs to Sustainable Development Goals
3
SDGs Process in the Post 2015
4
SDGs in the Post 2015 Development Agenda
Outcome Document of The United Nations Summit for The Adoption
of The Post-2015 Development Agenda
5
• Sustainable Development Goals Agenda:
• Renewing and strengthening commitment to MDGs
(MDGs+)
• Based on Agenda 21
• Focus on 3 dimensions of Sustainable Development
(Pillars: Economic, Socio and Environment)
• A coherent and integral part of Post-2015 Development
Agenda
6
“Alongside continuing development priorities such as poverty
eradication, health, education and food security and nutrition,
it sets out a wide range of economic, social and environmental
objectives. It also promises more peaceful and inclusive
societies. It also, crucially, defines means of implementation.“
7
Main Components:
• Human resources development and welfare improvement
• Inequality and poverty alleviation
• Access to basic infrastructure and public services
• Inclusive and sustainable economic development
• Environment, natural resources, ecosystem, bio-resources
management and development
• Promote peaceful and inclusive societies
• Targets (some) and Means of Implementation (including finance,
technology, and capacity development)
8
Sustainable Development Goals
No.
Proposed Goals
1
End poverty in all its forms everywhere
2
End hunger, achieve food security and improved nutrition,
and promote sustainable agriculture
3
Ensure healthy lives and promote well-being for all at all ages
4
Ensure inclusive and equitable quality education and
promote life-long learning opportunities for all
5
Achieve gender equality and empower all women and girls
6
Ensure availability and sustainable management of water and
sanitation for all
7
Ensure access to affordable, reliable, sustainable, and
modern energy for all
Targets
MoI
9
No.
Proposed Goals
Targets MoI
8
Promote sustained, inclusive and sustainable economic growth,
full and productive employment and decent work for all
9
Build resilient infrastructure, promote inclusive and sustainable
industrialization and foster innovation
10 Reduce inequality within and among countries
11
12
13
14
Make cities and human settlements inclusive, safe, resilient and
sustainable
Ensure sustainable consumption and production patterns
Take urgent action to combat climate change and its impacts*
Conserve and sustainably use the oceans, seas and marine
resources for sustainable development
10
No.
Proposed Goals
Targets
15 Protect, restore and promote sustainable use of terrestrial ecosystems,
sustainably manage forests, combat desertification, and halt and
reverse land degradation and halt biodiversity loss
16 Promote peaceful and inclusive societies for sustainable development,
provide access to justice for all and build effective, accountable and
inclusive institutions at all levels
17 Strengthen the means of implementation and revitalize the global
partnership for sustainable development (Finance, Technology,
capacity building, Trade, Policy and institutional coherence, Multistakeholder partnerships, Data, monitoring and accountability)
Total
169
MoI
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Highlights of Selected Goals
Goals
Goals 1. End Poverty in all its forms
everywhere
Selected Targets

Eradicate extreme poverty for all people everywhere by 2030
 Reduce at least by half the proportion of all ages living in
poverty by 2030
 Implement nationally appropriate social protection systems by
2030
Goal 2. End hunger, achieve food security  End hunger and ensure access by all people, in particular the
poor and people in vulnerable situations by 2030
and improved nutrition and promote
sustainable agriculture
 End all forms of malnutrition by 2030
Goal 3. Ensure healthy lives and promote
well-being for all at all ages
 Reduce the global maternal mortality ratio to less than 70 per
100,000 live births by 2030
 End preventable deaths of newborns and children under 5
years of age by 2030
12
Goals
Goal 4. Ensure inclusive and equitable
quality education and promote lifelong
learning opportunities for all
Selected Targets
 Ensure that all girls and boys complete free, equitable and
quality primary and secondary education by 2030
 Ensure that all girls and boys have access to quality early
childhood development by 2030
 Ensure equal access for all to affordable and quality technical,
vocational and tertiary education, including university by 2030
 Substantially increase the number of youth and adults who
have relevant skills by 2030
Goal 6. Ensure availability and sustainable  Achieve universal and equitable access to safe and affordable
drinking water for all by 2030
management of water and sanitation for
all
 Achieve access to adequate and equitable sanitation and
hygiene for all by 2030
13
Goals
Goal 7. Ensure access to affordable,
reliable, sustainable and modern energy
for all
Goal 8. Promote sustained, inclusive and
sustainable economic growth, full and
productive employment and decent work
for all
Selected Targets
 Ensure universal access to affordable, reliable and modern
energy services by 2030
 Increase substantially the share of renewable energy in the
global energy mix by 2030
 Double the global rate of improvement in energy efficiency by
2030
 Achieve higher levels of economic productivity
 Improve global resource efficiency in consumption and
production and endeavour to decouple economic growth from
environmental degradation
 Substantially reduce the proportion of youth not in
employment, education or training by 2030
14
Goals
Goal 9. Build resilient infrastructure,
promote inclusive and sustainable
industrialization and foster innovation
Selected Targets
 Develop quality, reliable, sustainable and resilient
infrastructure, to support economic development and human
well-being
 Promote inclusive and sustainable industrialization
Goal 10. Reduce inequality within and
among countries
 Increase the access of small-scale industrial and other
enterprises, to financial services, and their integration into
value chains and markets
 Progressively achieve and sustain income growth of the bottom
40 per cent of the population at a rate higher than the national
average
 Adopt policies, especially fiscal, wage and social protection
policies, and progressively achieve greater equality
 Improve the regulation and monitoring of global financial
markets and institutions and strengthen the implementation of
such regulations
15
Goals
Selected Targets
Goal 12. Ensure sustainable consumption 
and production patterns
Goal 14. Conserve and sustainably use the 
oceans, seas and marine resources for
sustainable development

Rationalize inefficient fossil-fuel subsidies
Sustainably manage and protect marine and coastal ecosystems
to avoid significant adverse impacts
Effectively regulate harvesting and end overfishing, illegal,
unreported and unregulated fishing and destructive fishing
practices
 Conserve at least 10 per cent of coastal and marine areas,
consistent with national and international law
 Enhance the conservation and sustainable use of oceans and
their resources
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2. Sustainable and Inclusive Development in Indonesia:
An Unfinished Agenda
• Economic growth in Indonesia for the past decade has transformed
the economy, increase welfare
• Total number and percentage of extreme poverty has rapidly
declined (people lived under USD1.25 a day)
• Depth of poverty has declined
• However, vulnerability to poverty (the near poor) remains significant
(people lived under USD2 a day)
17
Economic Insecurity and Vulnerabilities*
• Decreased job growth, increased economic insecurity
and vulnerabilities
– High incidence of informal sector jobs
• Youth unemployment
– Youth unemployment is forecast to edge upwards in 2015
• Social security system in transition
18
Increasing Income Inequality
Income inequality (Gini ratio) in Indonesia increased from 0.36 in 1996 to
0.41 in the latest available year.
Indonesia’s Gini Coefficient, 1996–2014
0.45
0.41
0.40
0.35
0.36
0.36
0.36
0.37
0.41
0.41
0.41
0.38
0.35
0.33
0.31
0.30
0.25
0.20
1996
1999
2002
2005
2007
2008
2009
2010
2011
2012
2013
2014
Source: BPS
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Unfinished Development Agenda: Selected Indicators
Maternal death
per 100,000
live birth
346 (SP 2010)
Infant mortality
rate per 1,000
live birth
32 (2012/2013)
Source: RPJMN 2015-2019,Susu
Book I
Prevalence of
malnutrition
(underweight) for
children age less
than 5 years
(percent)
19,6 (2013)
Access to clean
water 70% (2014)
Prevalence of
stunting (height
short and very
short) for children
(age less than 2
years) (percent)
32,9 (2013)
Access to
sanitation 60.9%
(2014)
20
Unsustainable Use of Resources
•
Asia-Pacific economy, including Indonesia is
requiring more resources to produce one
dollar of GDP as the economy grows
10
CO2 emissions from fuel combustion
(IEA) [Metric tons of CO2 equivalent
per capita]
9
•
Future growth of resource use in several
countries, including Indonesia holds
significant implications for overall resource
demand
8
7
6
5
4
•
Vulnerability to natural disasters (Indonesia
prone to natural disasters):
– 42% of the global economic losses due
to natural disasters
– Disaster losses since 1980 have
increased by 16 times in Asia while GDP
per capita has grown by only 13 times
3
2
1
0
1992-2002
1992-2012
1993-2003
2002-2012
China
East Asia and Pacific
East Asia and Pacific developed economies
East Asia and Pacific developing economies
Source: Compiled from UN ESCAP Statistical Database, 2015
Source: UN ESCAP, 2014
3. Framework for Priority Policies and Strategies
On the onset of Global Economic Situation*:
• Subdued euro zone economy, decelerating China growth and Policy uncertainty in US
Impact on Asia-Pacific (including Indonesia)
• Decreased economic activity through the trade and finance channel
• Estimated regional GDP loss of 3% since the onset of the global crisis five years ago - $870 billion
• Loose monetary policies, quantitative easing (QE), of the developed world including in US and the end of QE
starting in 2014
Impact on Asia-Pacific (including Indonesia)
• Short-term capital flows volatility
• Rapid short-term currency appreciation turned into depreciation
• Food and fuel price volatility (increase during the commodity boom period of 2000s until 2011 and now food and
fuel price decrease, currency appreciation/depreciation and volatility and end of oil subsidy for certain countries)
Impact on Asia-Pacific (including Indonesia)
• Poverty and inflation
*Modified from UN ESCAP, 2014
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Priority Policies and Strategies
Inclusive and Sustainable
Development
Resource
mobilization
Higher
Productivity and
Sustained Growth
Public debt and
inflation
Required public
investment
ECONOMIC
PILLAR
Source: UN ESCAP, 2013
Healthier and more educated labor
force, Better environment, Resilient
people, Inclusive society
Strengthening social and environmental pillars
by providing universal access to basic public
services through well designed national public
investment policies, that focus on:
Education
Health
Income Security
SOCIAL
PILLAR
Energy security
Human security
Environmental protection
ENVIRONMENTAL
PILLAR
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4. Green Economy and Sustainable Development
(Source: Murniningtyas, 2015)
• Green Economy and Sustainable Development Concept
• Principles of Green Economy
• Economic Restructuring; Sustainable Consumption and Production
• Internalizing Environmental Aspect into Economic
and Social Pillars
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GREEN ECONOMY AND SUSTAINABLE DEVELOPMENT
SUSTAINABLE DEVELOPMENT
1.
2.
3.
4.
5.
6.
Social Aspect
Equity
Health
Education
Security
Housing
Population
Economic Aspect
1. Economic
structure
2. Consumption
and
production
pattern
Human
Development/MDG
Green Economy
Environment Aspect
1. Atmosphere
2. Land
3. Coastal and sea
4. Clean water
5. Biodiversity
Environment and
Biodiversity
Governance Aspect
1. Institutional
framework
(institution, interrelationship and
rules)
2. Capacity:
institution and
human resources
Governance
Disadvantage 2:
environmental valuation and
internalization into economic
and social pillars
Disadvantage 1:
environmental aspect is not as
developed as economic and
social pillars  needs data,
measurement/ indicator
Source: Framework for Construction of Sustainable Development Indicators, September, 2001
in Murniningtyas, 2015
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GREEN ECONOMY
1.
Resource efficiency
2.
Minimum/clean waste
3.
Renewable resources
DEFINITION  AN ECONOMY WHICH:
1. Utilization of resources is efficient (in particular non renewable resources):
a. Resources can be utilized “longer”
b. Efficient – no “waste”
Key: continuous increase in productivity – technology is key
2. Utilization of resources along its value chain such that:
a. Zero waste
b. Minimal waste – can be absorbed by the ecosystem
Key: Technology for development of by-product; and Clean Technology for separation and
recycling of waste, safe for the ecosystem
3. The use of renewable resources:
a. No non-biodegradable waste
b. Usage in support of environmental capacity/growth/ regrowth (maximum sustainable
yield)
Sustainable use of
resources and
management of
the environment
for our future
generation
Source: Murniningtyas, 2015
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Where to start?
1. Economic restructuring (at macro level):
a. Value added creation – value added chain in economic activity –
industry/manufacturing (technology is key)
b. Services – sector which relies on human resources, skills.
2. Sustainable consumption and production:
a. Efficient consumption and zero waste (versus affluent
consumption with high waste)
b. Production: efficient use of resources and environmental
friendly.
Source: Murniningtyas, 2015
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STAGES - MILESTONE
SUSTAINABLE DEVELOPMENT IMPLEMENTATION
Greenhouse Gas Emission
Reduction (Low Carbon
Development)
Reducing water
and land
pollution
SCP
Green Economy
• Resource efficient
• Sustainable production
• Sustainable
consumption
Green procurement
Green standard
....... Sustainable
Development
• SCP
• Economic
structure
Green financing
Green banking
Green jobs
Including Governance
Source: Murniningtyas, 2015
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Components and Strategic Approach of
SCP INDONESIA
Sustainable Concumption and Production
PRODUCTION:
1. Agriculture
2. Fisheries and Maritime
3. Energy and Mining
4. Industry
5. Services: finance; tourism,
environment, expertise
Consumption:
1. Households
2. Corporation
3. Living: City, Style/living
Law-regulations: Procurement, Standard
Human resources: capacity for implementation
Science and technology: Green technologi and knowledge
Source: Murniningtyas, 2015
Information and data: Communication, information and database/indicator
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TO INTERNALIZE ENVIRONMENTAL ASPECT INTO ECONOMIC AND SOCIAL
PILLARS:
1. Address disadvantages 1 and 2 by: Completing data and
value/environmental valuation: (i) people have to understand
environmental attributes/characteristics (disadvantage 1); (ii)
understand disadvantage 2 as a result of economic and social
impact on environment due to economic activities which have gone
ignored
2. Enforcement of green economy through: (i) command and control
(regulation); and/or (ii) polluters pay principles (doing bad has its
price).
Source: Murniningtyas, 2015
30
5. Implementation and Priority Issues
Our National and International Commitment
• SDGs Agenda is in Indonesia’s national interest. Need strong commitment
and political will.
• 15 years horizon: 3 RPJMNs, across RPJP (beyond 2025)
• Built on 2014 baseline (Sustainable Development Indicators – baseline
RPJMN III). Many of the SDGs Targets are within reach, however…..
• Challenging year 2015: Economic Slowdown, increased poverty, increased
unemployment, stagnated or potentially decreasing socio-economic
welfare
31
• The Goals have to be translated into concrete annual targets,
budgets, roles of stakeholders (RPJMN – 5 year targets and indicative
budget, supported by Regulatory Framework, Budgetary Framework,
Institutional Framework, and Evaluation Framework or Kerangka
Regulasi, Kerangka Pendanaan, Kerangka Kelembagaan, Kerangka
Evaluasi)
• The importance of Outcome, Output and Process
• Have to synchronize with Performance Based Budgetary Framework
32
• The importance of synergy with Provinces, Kabupaten and Kota
Experiences with RAN MDGs and RAD MDGs, dan Inpres 3/2010
(Pembangunan yang Berkeadilan)
• The importance of synergy with all stakeholders (CSOs, academics,
communities, etc)
 Roles of Regional and Local Governments, and Communities
• Role of monitoring and evaluation, feed back mechanism to annual
planning
• Breakthrough and innovation initiatives
33
Economic Consideration:
• Macroeconomic stability is a must
• Conducive economic and business environment is a must
Both can not be taken for granted
• The need for inclusive economic development (employment creation
and poverty alleviation)
• What are the leading economic sectors? (manufacturing, services
including tourism and creative economy?)
• Market mechanism and incentives/disincentives vs Command and
Control
34
Human Resources and Institution Development
• Human resources: roles of education (with the education expansion –
a child now entering school age will have an expected years of
schooling of 13.2 years), but inequality in access and quality is still a
problem.
• Governance and institution development (Political, Law and
Bureaucracy Institutions) at the Central, Local and Private sector.
Implement and Internalize Green Economy Concept into the Social,
Economic and Environment Pillars (see PPT on Green Economy and
Sustainable Development)
35