Indonesia: Financial Sector Assessment Program-Technical Note on Climate Risk Assessment

Indonesia is exposed to both climate change transition risks and physical risks. With primary energy supply heavily dominated by fossil fuels, like many other countries, and as a major exporter of coal and liquefied natural gas, Indonesia is exposed to risks from the transition toward a carbon-neutral economy. Moreover, Indonesia is vulnerable to natural hazards, such as floods, droughts, and wildfires. With global temperatures rising, the frequency and severity of such events is expected to rise as well.