Webinar on the Decarbonization Opportunities of Small-to-Medium Enterprises (SMEs) in Indonesia and Lesson Learnt from Global Experience

Replay Event

Background

Indonesia is one of the largest economies in the world and continues to experience growth. Amongst other economic activities, the industrial sector as the backbone of the economy will also be expected to grow to support the realization of Indonesia Emas in 2045. Along with the growth, the expected growth of the industrial sector will contribute to the country’s total greenhouse gas emissions, which in 2021 have reached about 420 MtCO2 and are expected to double if no necessary measures are taken. Therefore, a commitment to transition towards more sustainable business and industrial practices is compulsory to control and limit the emissions to 31.89-43.2% less than the business-as-usual level in 2030, whilst ensuring the global competitiveness of Indonesia’s industry.

Small-to-medium enterprises (SMEs) hold a crucial position in Indonesia’s economy and constitute the largest share of manufacturing industries in the country. According to the Asian Development Bank, in 2019, SMEs accounted for about 99% of formal business and nearly 97% of employment in Indonesia. Locally, they also foster social development and equity, contributing to rural development, community empowerment, and poverty reduction. Despite its role in becoming the engine of economic growth locally and nationally, SMEs’ financial management and technical capacitances are often left behind to be developed compared to large businesses. Moreover, as with more relaxed regulations toward SME players, emissions from this sector are often overlooked and may unfold a higher number of emissions compared to the larger industry sector. Based on IESR’s latest study, it is found that the estimated energy-related emissions of SMEs reach 216 MtCO2 in 2023, on par with the emissions generated from industry sectors nationally.

This webinar is conducted to disseminate the latest study findings of IESR and LBNL that focus on exploring decarbonization opportunities suitable for SMEs in Indonesia. Key insights for SME players, policymakers, and financial institutions will be unfolded to unlock the untapped potential of energy efficiency and decarbonization in SMEs whilst improving their business competitiveness toward the current market change. Moreover, global experience on SME decarbonization will be shared to showcase the best practices that are already implemented in China, the United States, and other significant economies in the world hence providing a best reference for retrofitting for Indonesia’s SME landscape. The webinar will be held online via Zoom and streamed on IESR’s YouTube channel. It is expected that the webinar will provide valuable insights and spark innovative initiatives amongst all stakeholders in Indonesia to start the decarbonization journey for SMEs.

Objective

There are several objectives of this workshop:

Disseminate and share information on Indonesia’s Small-to-Medium Enterprises (SME) landscape on its economics, energy, and waste management,
Receive feedback from the SME decarbonization recommendation from relevant key stakeholders,
Discuss essential and actionable steps required to implement the decarbonization initiatives for Indonesia’s SMEs, and
Discuss challenges and opportunities, and initiate collaborations to promote decarbonization and sustainable growth in selected SMEs in Indonesia.