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By Prabowo Subianto
President of Indonesia
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The COP climate summits have never been short on ambition. But follow-through has fallen short. As fiscal pressures mount in developed countries, many are retreating from their climate-funding commitments to the developing world, however articulate the calls for justice.
For developing countries, the crisis in the Strait of Hormuz marks a turning point. Like many Southeast Asian neighbors, Indonesia, home to almost 300 million people, was acutely exposed. Before the crisis, 60 percent of Southeast Asia’s crude oil imports and a third of its gas imports came from the Middle East. The crisis exacted an immediate price for our reliance on fossil fuels. Meanwhile, rising seas along our coasts and devastating wildfires, fueled by this year’s strong El Niño, exposed the greater cost of our collective inaction.
For decades, climate negotiations have been trapped in a prisoner’s dilemma. What made economic sense for individual nations—relying on cheap, reliable fossil fuels—has had disastrous consequences for the world. But Hormuz has tipped the scales. Dependence on imported fossil fuels is now financially unsustainable. Renewable energy has become a matter of hard national interest: economic security, self-sufficiency in a precarious world and, ultimately, national independence.
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Many will contend that renewables have been cheaper for years. This overlooks the different economics of adding renewable capacity and transforming energy systems and retiring fossil-fuel infrastructure. While all nations confront this test, developing nations must weigh the latter’s expense and time required against the pressing demands of poverty reduction, development and industrialization, all dependent on cheap, reliable energy.
That it took a crisis of this magnitude to force such a reckoning speaks to the failures of the COP process to date.
Even if every commitment were honored, development banks and donor aid could not meet the $1.3 trillion a year developing countries need by 2035. The private sector should play its part in funding renewable generation that produces revenues. Yet that capital costs two to three times more in developing countries than in wealthy nations – often prohibitively so.
A system that overprices the risks of investing in developing countries, while failing to account for the far greater risks of not investing, demands reform. We must rewire the global financial architecture to meet developing countries’ needs. But that will take decades—time we do not have.
Developing countries now account for more than half of global emissions, and their emissions continue to rise, albeit more slowly. In the current geopolitical climate, larger emerging economies must take the lead in mobilizing capital themselves. Indonesia has pledged $1 billion to the Tropical Forests Forever Facility, alongside Brazil, helping attract private capital to protect tropical forests. But we must go further, putting the full weight of our own financial resources to work.
In Indonesia, we established a sovereign wealth fund, Danantara, in 2025, bringing nearly $1 trillion in state-owned assets under one roof and deploying their financial strength and balance sheet, including toward our energy transition.
We have launched a programme to build 100GW of solar power—against 88GW of installed capacity nationwide today. Danantara will help mobilize the investment required, alongside its work attracting private capital into projects that turn municipal waste into electricity. Some will question the feasibility of our ambitions. But in reality, it is the scale of investment necessary for a green transition that also meets the aspirations of our people.
In December, Danantara will be an anchor investor at the New Asia Forum, using public capital to attract private investment in clean energy in Indonesia and Southeast Asia, lowering risks for international investors. It is not a question of funding everything, but of making the developing world's energy transition financeable on the terms global markets impose.
None of this diminishes the responsibility of wealthy countries. But this division of finance can preserve scarce grants and concessional finance for what markets find even more difficult to fund: protection against climate change. Better flood drainage in Semarang, for example, can protect homes, businesses and livelihoods, but offers little direct financial return.
Indonesia can draw on its financial strength. Many smaller developing countries lack the financial muscle to act alone, while borrowing on international markets would cripple their public finances. For them, concessional support remains the only pathway. The developed world must be held to Belém’s call to triple adaptation finance by 2035.
But on the green transition, developing nations cannot suspend the aspirations of their people while the world reforms its financial system. Nor can the world suspend climate action until that reform is complete. We must find the means to advance both.
Prabowo Subianto is the President of Indonesia.
The views expressed in this article are the writer's own.
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