Indonesia and France have agreed to extend their long-standing cooperation to support green finance and sustainable development initiatives in the country.
The agreement was formalized through a third memorandum of understanding (MoU) between PT Sarana Multi Infrastruktur (PT SMI) and Agence Française de Développement (AFD).
PT SMI, a state-owned enterprise under Indonesia’s Ministry of Finance, plays a pivotal role in mobilizing funds for national infrastructure.
AFD is France’s development agency focusing on global sustainability, with an expanding footprint in Southeast Asia.
Renewed MoU Builds on a Decade of Green Finance Efforts
The renewed partnership continues the climate finance journey both institutions began in 2015.
Earlier collaboration included a $100 million loan from AFD to support low-carbon infrastructure projects in Indonesia.
In 2018, a second agreement led to an additional $150 million in credit within the SDG Indonesia One framework.
Key projects funded include clean water access in Pekanbaru, hydropower in Toraja Utara, and geothermal energy in Banyuwangi.
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New Agreement Focuses on Inclusive, Low-Carbon Development Strategy
The latest MoU emphasizes inclusive and climate-resilient infrastructure aligned with Indonesia’s net-zero ambitions.
It also aims to strengthen public-private collaboration through platforms such as SDG Indonesia One and the Energy Transition Mechanism (ETM).
“PT SMI is proud to continue our partnership with AFD, as we share the same vision in delivering clean energy solutions,” said Reynaldi Hermansjah, President Director of PT SMI.
He underscored the MoU’s significance in enhancing bilateral cooperation between Indonesia and France.
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Capacity Building and Knowledge Sharing Shape New Initiatives
Beyond financing, the MoU outlines joint efforts on technical assistance, training, and knowledge exchange.
These capacity-building efforts will address issues such as biodiversity, healthcare access, and solid waste management.
AFD has committed to support research and pilot programs that help local governments integrate climate considerations into policy.
Reynaldi noted that “shared expertise is key to enabling sustainable solutions that can scale.”
Bilateral Partnership Signals France’s Support for Indonesia’s SDGs
AFD’s ongoing support for Indonesia reflects France’s broader development diplomacy in the region.
“Our collaboration with PT SMI is built on trust and shared sustainability goals,” an AFD spokesperson said.
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The partnership is part of AFD’s strategy to align its global funding portfolio with the Paris Agreement and Sustainable Development Goals (SDGs).
Indonesia is seen as a strategic partner for France in Southeast Asia’s energy transition.
Green Financing Frameworks Gain Traction Through Institutional Synergy
The MoU supports the implementation of green finance instruments that align with global ESG standards.
PT SMI is developing financial products such as green bonds and blended finance to attract private capital.
Reynaldi stressed the importance of “creating platforms that allow various stakeholders to contribute to climate action.”
AFD has pledged to provide technical assistance for impact measurement and sustainable financial reporting.
Indonesia Aims to Leverage MoU to Attract Global Investors
Through this MoU, PT SMI is positioning itself as a gateway for global climate investors.
The firm will host international roundtables and investor forums to accelerate fund mobilization.
It also seeks to collaborate with multilateral institutions and philanthropic organizations.
“Together with AFD, we can be the right partner for those looking to make a real difference,” Reynaldi said.
A Step Forward for Green Financing in Southeast Asia
The Indonesia–France partnership through PT SMI and AFD marks a significant step in advancing climate finance.
With a focus on infrastructure, capacity building, and public-private partnerships, the MoU promotes long-term sustainability.
By leveraging platforms like SDG Indonesia One and the ETM Country Platform, both nations aim to scale solutions to climate challenges.
The agreement demonstrates a shared commitment to inclusive, low-carbon development in Indonesia and beyond.***
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