Jakarta: Minister of Finance Sri Mulyani Indrawati was one of the speakers at the Seminar on Sustainable Financing in Developing Countries: Challenges and Opportunities that took place in the city of London on Tuesday.
She stressed the importance of green financing regulations, benchmarking instruments and to invite the private sector to be able to participate to boost the market.
However, she stated that green bonds issued by Indonesia were not fully green although they were quite attractive to the international market. Of the buyers' portfolios, 29% were bought by green investors and 71% were bought by regular investors.
"Although international investors' interest are quite high, I don't really see the reflection in terms of their preference being green and linked to the project that I'm going to enjoy a certain price premium for that," the Finance Ministry's wesbsite quoted the minister as saying.
However, eventhough investors encouraged the Ministry of Finance to issue more green bonds, she is also concern for the investment manager's consideration on how to promote it, how much they will buy, the country to market, what instruments to issue and what is also important is the stability of the country.
Last week, the former World Bank managing director stated the Government's debt position is still safe. In addition, the Government always manages debt extremely prudent.
According to her, macroeconomic management policies to achieve development goals including debt instruments are flexible. If the economic conditions have improved, the debt will be reduced so that the fiscal space in the State Budget (APBN) can be increased.
She also reminded that debt should be seen as an instrument not a goal. For example, the Government actively issues retail bonds to the domestic community, among others, to expand the investment market. If the domestic community is more dominant in investing in the government debt market, it is expected to reduce volatility in the event of a global economic shock.