Indonesia calculates GDP of the poor in fight against climate change

Indonesia took a key step towards its ambitious goal of transitioning towards a green economy. The country tested a new model that shows policymakers how their development decisions can help or hinder the green transition. The Indonesia Green Economy Model (I-GEM) also shows how development interventions can affect the incomes of poor people who are largely reliant on natural resources for their livelihoods - revealing often unseen capital of the poor for the first time.

A key step towards making this transition was taken when the country began testing the new I-GEM. This model allows policymakers to measure the impact of development proposals. It can be used to see how interventions made under 'business-as-usual' scenarios compare with green economy actions. Specifically, policymakers can see the impacts in a particular province on poor people's incomes; the depletion or degradation of natural resources; and the availability of decent green jobs.

Green GDP is an alternative measure of GDP that takes into account the loss of natural capital. Along with the Decent Green Jobs indicator (developed by the International Labour Organization), Green GDP has been widely used around the world. But, I-GEM also incorporates a new 'GDP of the Poor' indicator that reveals, for the first time, the impact of certain policy interventions on poor people's incomes, whose living often depends on nearby ecosystem services.