Impact Policy Tracker Policy

Indonesia Sovereign Blue Bond



With the launch of Indonesia’s Integrated National Financing Framework (INFF) and the SDG Government Securities Framework, the government prioritised “scaling innovative finance instruments in sustainable capital markets, faith-based mechanisms”, including impact investment and the blue economy. In that context, Indonesia issued a blue bond whose proceeds (JPY20,7 bn or USD 150 million) targeted the blue economy, including coastal protection, sustainable management of fisheries and aquaculture, marine biodiversity conservation and mangrove rehabilitation.

Highlights

  • First of its kind by a sovereign: the bond is a first-of-its-kind, being the world’s first publicly offered sovereign Blue Bond in line with the International Capital Market Association (ICMA) principles, an important precedent that could serve as a blueprint for other countries to finance their ocean agendas.

  • Aligned with existing sustainable finance strategies: the issuance of the bond is part of the government’s larger strategy to support sustainable, inclusive growth in the blue economy and to diversify financing instruments and widen the investor base, evidenced in Indonesia’s INFF, and presidential decree 59/2017 and its SDG Government Securities Framework.

Government’s Role:
Market Participant


Country:
Indonesia

Policy Type:
Sustainable Bonds

Year: 2023

Responsible Institution:
Ministry of National Development Planning/Bappenas (MNDP/Bappenas), Ministry of Finance (MOF), Financial Services Authority (OJK), Coordinating Ministry of Maritime and Investment Affairs (CMMIA), Ministry of Investment (MOI), United Nations Development Programme (UNDP).

Additional information:
UNDP: Indonesia. Bridging the SDG financing gap with the support of innovative financing instruments
Indonesia Successfully Issues JPY 104.8 billion Samurai Bond and Inaugural Blue Bonds

Sustainable Bonds

What are Sustainable Bonds?

Within the set of financial instruments that fall under the impact investing umbrella, Green, Social, Sustainability, Transition, Blue, Gender and Sustainability-Linked bonds (often collectively referred to as GSS+, ESG, thematic, labelled or sustainable bonds) have gained prominence in recent years for their potential to help bridge the SDG financing gap. Governments, especially in emerging economies, play a catalytic and pivotal role in scaling these instruments. By issuing sustainable bonds, national, regional, and local public entities mobilise capital for long-term investments with broad social and economic benefits, which often fall outside the scope of conventional, profit-driven financing.

Public issuers are not only large players in terms of volume, representing approximately 50% of sustainable bond issuances annually since 2020, but also critical market enablers. Government-led issuances serve as signals of policy commitment to sustainability, helping to build investor confidence and drive demand from both domestic and international capital markets. Moreover, public sector issuances typically align with international standards and best practices, such as the ICMA principles, thereby setting a benchmark for transparency, impact reporting, and accountability. This leadership lowers the perceived risk for other issuers and facilitates replication by subnational governments, state-owned enterprises, and even private entities. Thanks in part to these public sector efforts, the sustainable bond market continues to grow rapidly. In 2025, issuance of sustainable bonds is projected to reach USD 1 trillion, accounting for 11% of the global bond market, a milestone that reflects both rising investor appetite and the enabling role played by governments in expanding this segment of sustainable finance.

For more information on sustainable bonds and their market trends, visit S&P Ratings “Sustainable Bond Outlook 2025”, Sustainable Fitch “Sustainable Finance Outlook 2025”