The Center of Economic and Law Studies (Celios) has outlined 14 potential funding sources that could support Indonesia’s transition to a socio-bioeconomic model − an innovative approach integrating social equity, ecological preservation, and economic development.

In a policy brief titled “Socio-Bioeconomy: Integrating Biodiversity Conservation and Social Cohesion in Indonesia’s Economic Transformation”, Celios researcher Viky Arthiando Putra emphasized the need for sustainable and diversified financial mechanisms to drive this transformation.

One of the less-explored funding avenues proposed is the biodiversity loss tax, a levy targeting individuals or corporations responsible for damaging or reducing biodiversity in the country.

“This tax is still a new idea, but our projections show it could generate up to Rp2.12 trillion (US$130 million),” Viky said during a presentation on Thursday, May 22, 2025.

Another significant potential funding source is the Loss and Damage Fund, a global climate finance mechanism intended to support developing nations facing unavoidable climate change impacts, such as natural disasters and rising sea levels. Indonesia could potentially access Rp544 trillion from this mechanism.

Additional sources include:

● Green sukuk (Islamic green bonds), which could attract Rp24.65 trillion;

● Carbon taxes, with revenue potential of Rp69.75 trillion;

● Coal production taxes, estimated between Rp28.76 to Rp47.59 trillion.

Levies on extractive commodities (e.g., nickel, copper, bauxite, tin), with a massive potential of Rp6,804 trillion

Viky also addressed wealth taxation, highlighting Indonesia’s economic inequality. He suggested that taxing the wealthiest 2 percent of the population could yield Rp81.8 trillion, noting that this segment holds as much wealth as 5 million Indonesians combined.

Environmental and corruption-related funds were also identified. Redirecting funds from environmental and extractive sector corruption cases could contribute Rp371.2 trillion. Meanwhile, the government could repurpose Rp111.6 trillion from People’s Business Credit (KUR) and ultra-micro credit schemes towards productive socio-bioeconomic ventures rather than consumer spending.

Other sources include:

● Export levies on palm oil: Rp24.4 trillion;

● Sustainability-linked bonds (SLB): Rp1 trillion;

● Tropical Forest Forever Fund (TFFF): Rp6.68 trillion;

● Environmental Fund Management Agency (BPDLH): Rp207.63 billion.

“The idea is to create a system where environmental protection and social equity are not side effects, but central components of economic development,” Viky said.

He asked the government to align fiscal and environmental policies to support long-term socio-bioeconomic resilience.