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Indonesia’s climate diplomacy foresight: Leveraging the Asia zero emission community (azec) as a strategic bridge to net zero 2060
Indonesia’s energy transition faces the challenge of balancing accelerated decarbonization, economic growth, and energy sovereignty. Limited JETP disbursement and demands for rapid coal retirement risk industrial stagnation and dependence on non-concessional debt. This paper recommends an Active Hedging strategy that leverages the Asia Zero Emission Community (AZEC) as a technological and financial bridge for geothermal energy, small modular nuclear reactors (SMRs), hydrogen, and carbon capture technologies. The Ministry of Foreign Affairs should coordinate cross-sectoral efforts with Danantara and APLSI while strengthening climate-finance diplomacy and pursuing international recognition of carbon units as financial instruments. This strategy aims to support Indonesia’s target of 42.6 GW of renewable energy capacity by 2034 while safeguarding industrial competitiveness and energy security on the path toward Net Zero Emissions by 2060 or earlier.
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