Transformative Fiscal Transfers for Tropical Forests and Global Climate: Building science-informed policy capacities in Indonesia and sharing learning with the Global South
This project builds science-informed policy capacity around ecological fiscal transfers for tropical forest conservation in Indonesia, examining how fiscal mechanisms can incentivize subnational governments to protect and restore forest cover while strengthening national climate commitments.
About the project
This project examines how ecological fiscal transfers can be used as a policy tool to incentivize forest conservation and restoration in Indonesia, connecting fiscal transfer design with climate finance performance for forested subnational governments. It builds science-informed policy capacity and shares lessons learned with other Global South countries facing similar forest-climate-fiscal challenges.
Problems
Despite Indonesia's integration of forest cover into its fiscal transfer system, there remains a lack of authoritative, science-informed knowledge products to guide and legitimize this policy globally. Subnational governments in forested regions, often lack accessible information on how their fiscal transfers are calculated and how these could change depending on decisions to conserve or convert forest cover. At the same time, Indonesia's potential to lead the Global South in transformative, forest-based fiscal policy remains underleveraged, limiting broader uptake and shared responsibility for tropical forest protection and climate stabilization.
Approach
CCSF UI brings science-informed knowledge into national policy discussions on domestic resource mobilization for climate action, while fostering stakeholder capacities for climate finance at both national and subnational levels through cutting-edge research and policy innovation. By combining this knowledge base with built capacities, the project works to translate research into fiscal policy transformation, documenting and publishing authoritative knowledge products, engaging directly with forested subnational governments, and positioning Indonesia's experience as a reference point for other tropical forest nations.
Objectives
1. Establish CCSF UI as the go-to institution and global reference on forest cover-based ecological fiscal transfer
2. Strengthen subnational policy capacity by making information on DAU transfers, calculations, and forest-cover-dependent scenarios accessible to forested provinces and districts
3. Shape Indonesia's global leadership in tropical forest and climate fiscal policy, inspiring Global South countries to adopt similar transformative approaches and share responsibility for forest protection and climate stabilization.
Outputs
Knowledge production and publication-On going :
1. Forest cover, fiscal transfers, and performance audit: connecting the two value chains for forest finance in Indonesia
2. Characterizing the first ecological fiscal transfers for tropical rainforest: Reforestation and Afforestation Grants in Indonesia
3. Spatializing Forest and Fiscal beyond the Paper Trail: An Assessment of The World’s First Ecological Fiscal Transfers for Tropical Watershed
4. Conditions of Transformative Fiscal Transfers for Forest and Climate in Indonesia and India
5. Ecological fiscal transfers for tropical forest: scale and competing effects
Workshop Sosialisasi Dana Alokasi Umum (DAU): Tutupan Hutan Daerah sebagai Indikator Penghitungan DAU (in 5 forested jurisdictions) :
1. Palangka Raya
2. Kerinci
3. Sorong Selatan
4. Sigi
5. Kapuas Hulu
Participation in COP30 and COP31 as platforms to amplify Indonesia's ecological fiscal transfer scheme on the global stage, sharing the country's experience and lessons learned