Indonesia Climate Change Development Policy Project

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The Climate Change Development Policy Loan (CC DPL) Program to Indonesia for US$ 200 million will support the Government's policy agenda on climate change, an issue of growing global concern. The CC DPL is envisioned as a series of four annual single tranche loans of similar size anchored to the FY09-FY12 Country Partnership Strategy (CPS). CC DPL provides support in three core areas: (i) addressing the need to mitigate Indonesia's greenhouse gas emissions; (ii) enhancing adaptation and resiliency efforts in key sectors; and (iii) strengthening the institutions and cross-cutting policy framework needed for a successful climate change response. Indonesia is highly vulnerable to climate change impacts - sea level rise, changing weather patterns, and increased uncertainty. Potential impacts include: increased threats to food security and agricultural productivity; impacts on productive coastal zones and community livelihoods; consequences for water storage; intensification of water- and vector-borne diseases; and deterioration of coral ecosystems. These changes will put past development gains and poverty alleviation efforts at risk. An approach that increases adaptive ability, builds community resilience and increases preparedness for managing disasters makes economic sense for Indonesia, a kind of insurance. Indonesia may also be able to tap into new forms of global financing to assist in this adaptation response.