Kadin: Indonesia Guarantees The Highest Green Bonds And Sukuk

Financial illustration (Photo: Antara)

JAKARTA - The Chamber of Commerce and Industry (Kadin) stated that Indonesia is able to maximize green sukuk to realize green finance or green financing.

Deputy of Islamic Banking of the Indonesian Chamber of Commerce and Industry (Kadin) Banjaran Surya Indrastomo said that green sukuk is an investment instrument in the form of bonds or underlying assets based on sharia principles with the aim of supporting environmentally friendly and sustainable projects.

Indonesia is the highest guarantor of green sukuk bonds, in this context, because after all the majority of Indonesia's population is Muslim. We have the opportunity and opportunity to realize green financing, one of which is green sukuk," said Banjaran quoting Antara.

Green sukuk is designed to support the concept of green finance, which means overall support from the financial services industry for sustainable environmental, social and governance (ESG) growth.

Banjaran explained that green sukuk is one of the financial instruments that has the potential to sustain the environment. This is because the liquidity of green sukuk is still maintained.

"This green hole can be one of the tools to contribute to green projects run by the government, it will also benefit from investments invested, both financially and environmental sustainability benefits for the future, Indonesia is trying to lead this development, and I think one of our opportunities is to encourage this development from green corporate sukuk and green sukuk," he also said.

Indonesia issued its first green sukuk in March 2018. The green sukuk is five years long with a value of 1.23 billion US dollars or equivalent to Rp. 16.75 trillion US which will mature in 2023.

The transaction is arguably the first green sukuk transaction in the world, with a percentage of investors recorded at 32 percent of the Islamic market, 25 percent of the Asian market, 15 percent of the European Union market, 18 percent of the US, and 10 percent of Indonesia.