Indonesia’s circular economy opportunity

If the linear “take-make-waste” model continues to be the modus operandi for Indonesian businesses, the country is poised to produce a staggering amount of 155.3 million tonnes of waste collectively from five industries — food and beverage, textiles, wholesale retail and trade, construction, and electronics — by 2030 according to a recent report by the Ministry of National Planning and Development Indonesia (BAPPENAS), UNDP, and the Government of Demark.​

This poses multiple societal and environmental challenges such as scarcity of resources, degradation of natural ecosystems, and unbridled pollution; all of which negatively impact the livelihoods and health of society at large.

If Indonesia were instead to adopt a circular economy, it is projected to generate an additional economy-wide GDP of IDR593 to IDR638 trillion, and reduce waste, carbon emissions, and water consumption significantly while creating 4.4 million net cumulative jobs by 2030 — a boost much needed in the post-pandemic recovery.

A recent announcement by Mr. Airlangga Hartato, Coordinating Minister for Economic Affairs, affirmed the government’s commitment to transform Indonesia's economy into a circular economy in order to increase the country’s GDP and job opportunity while saving natural resources. With 64 million small and medium enterprises (SMEs) making up a substantial part of the Indonesian economy, it is also vital to ensure they are part of the important national conversation around the circular economy opportunity.

In support of Sustainable Development Goal 12 (Responsible Production and Consumption), this important dialogue will discuss how the circular economy can enable a more sustainable production life-cycle within and beyond the five industries mentioned above, providing many opportunities for public-private partnerships and collaboration.