Arnoldus Kristianus, Kuala Lumpur – The National Development Planning Agency, or Bappenas, has said that Indonesia requires Rp 67,000 trillion to fund programs aimed at achieving its Sustainable Development Goals.
"In Indonesia, we need Rp 67,000 trillion to achieve SDGs by 2030 and there's still a gap of Rp 14,000 trillion to fill the needs," Setyo Budiantoro, the economic development pillar manager at Bappenas, said on the sidelines of an international seminar in Kuala Lumpur on Tuesday.
Efforts to collect the huge funding will require synergies among stakeholders such as the government, the private sector, philanthropic organizations, religious institutions, and investors.
"The challenge for Indonesia is how we can orchestrate and synergize extraordinary efforts from many parties. If we can do that, it won't be difficult [to achieve the funding target]," Setyo said.
From the religious sector, Muslim donations like zakat and waqf can contribute hundreds of trillions of rupiah to the programs. Setyo pointed to zakat, which has potential funds amounting to Rp 327 trillion, but only Rp 14 trillion per year has been collected.
From waqf – property donation for religious or community use – there is the potential to collect Rp 180 trillion, he added.
He said another challenge in SDG funding is the regulation that has yet to give a favorable ecosystem for impact financing – an investment strategy that aims to generate specific beneficial social or environmental effects in addition to financial gains.
"The treatment for commercial and impact finance is the same. So if you have a good project that helps vulnerable people, such as those with disabilities, it is just a regular commercial project in terms of tax treatment," he said.
Asian Venture Philanthropy Network CEO Naina Subberwal Batra said that the challenges to achieving SDG are poverty, inequality, climate change, gender and education discrepancy.
At the same time, there are also troubles regarding the increasing frequency of extreme weather, geopolitical tension, pandemic vulnerabilities, and the increasing inequality gap which will disrupt the foundation of socio-economy infrastructure.
"This is why we must act, not only to solve the challenges in the region but to also use this solution to place a new perspective as a consideration to effectively overcome critical global challenges with negative impacts," Naina said.