De-Risking Financial Instrument Recommendation for More Bankable Projects

As part of the ongoing commitment to assist PT Sarana Multi Infrastruktur (PT SMI) in creating more bankable pipeline projects, Global Green Growth Institute (GGGI) has recently completed and handed over the study namely “Product Analysis of Diverse de-Risking Financial Instruments Available in Indonesia’s Market” in October 2019.


Through the study, GGGI has delivered key gaps analysis as well as the de-risking financial instrument recommendation and next steps for PT SMI to consider in creating more bankable pipeline projects using these recommended de-risking financial instruments.


Capital advanced towards green projects in Indonesia remains constrained. This is partly due to the lack of available financial vehicles and instruments that can meet risk-reward expectations of investors and unlock capital. Despite the ongoing efforts by the Government of Indonesia to create more conducive enabling policy in green sectors, funding into the green sector remains the main issue as investors especially from the private sector still perceive green projects as high risk. As such, providing innovative financial mechanism to these green projects are imperative for attracting private capital and upscaling the impact. Therefore, de-risking financial instruments are essential to stimulate investments in green projects, given the innovative and therefore uncertain nature of many of these projects. The use of financial instruments can help create an increased number of green project opportunities.


Download the study here