The Ministry of Environment and Forestry (KLH) and the Environmental Fund Management Agency (BPDLH) of Indonesia are set to finalize an international cooperation agreement with global carbon standard body Verra, in the form of a Mutual Recognition Agreement (MRA) expected to be signed in early October 2025.
Erna Susilawati, Human Resource Analyst at KLH, confirmed that the drafting of the MRA document has reached its final stage, with both parties now completing the last round of reviews before formal signing.
“The process has already reached common ground. We are just waiting for their final review. Once the document is aligned, we will schedule the signing of the MRA. Hopefully, it will be realized in early October,” Erna told Katadata.co.id, on Friday, September 26, 2025.
She cited that the MRA required a lengthy negotiation process due to its mutual nature, involving both state authorities and a private international body.
“Since it is a mutual agreement, the document is drafted together. We reviewed their draft, they reviewed ours, and then we sought a middle ground. For example, how dispute settlement is arranged, or what accreditation mechanisms are acceptable to both sides. So, a compromise had to be found,” Erna said.
According to her, Indonesia’s carbon trading market will gain stronger international standing through this MRA. The deal will ensure mutual recognition of methodologies, accreditation mechanisms, and market schemes between Indonesia and Verra.
“With the MRA, project proponents in Indonesia can apply methodologies already agreed upon. Emission reduction certificates could even carry joint labeling between Indonesia’s national registry (SPE) and Verra. This means Indonesian carbon credits could be sold both in Verra’s markets and the SPE,” Erna said.
She added that the agreement would enhance the credibility and market access of Indonesian carbon credits, while also opening opportunities for more competitive pricing.
“Previously, we could not use Verra’s framework. Now, with mutual recognition, Indonesia’s carbon market will expand significantly and achieve far better pricing,” she said.