Snapshot of Indonesia's Provincial Green Economies: A Complexity Approach

Schalke Anindya Putri

MPRA Paper from University Library of Munich, Germany

Abstract: This study investigates Indonesia's green complexity at the provincial level, examining the country's capabilities to produce sophisticated environmental goods while pursuing its 2060 net-zero emissions target. The research uniquely contributes by applying Green Complexity Index (GCI) analysis at the subnational level, revealing critical intra-country differences in green development potential. The study analyzes 493 green products identified from IMF, OECD, and WTO data, categorized into renewable energy, pollution management, clean technologies, and resource management. Trade competitiveness data from WITS and BPS covers 34 Indonesian provinces and 226 countries, using 2022 trade data. The methodology employs Economic Complexity Index (ECI) calculation, Green Complexity Index (GCI) derivation, and Product Distance measurement to assess regional green capabilities and development trajectories. DKI Jakarta leads in green product exports (370 products) and competitive exports (48 products), with a weak positive correlation between ECI and GCI across provinces. While Jawa Barat leads in ECI (1.48), Jakarta tops GCI rankings (13.12). Regional disparities show Kepulauan Riau leading in renewable energy (GCI: 3.05) and clean technologies (GCI: 8.34), while Jakarta dominates pollution management (GCI: 4.53). The study reveals substantial regional variations in green complexity across Indonesian provinces, concentrated in developed regions. The findings suggest the need for province-specific strategies, knowledge transfer mechanisms, and innovative green finance solutions to promote sustainable development.

Keywords: Green Complexity Index; Economic Complexity; Product Distance; Regional Development (search for similar items in EconPapers)
JEL-codes: Q56 (search for similar items in EconPapers)
Date: 2024-11, Revised 2025-01
New Economics Papers: this item is included in nep-ene, nep-env and nep-sea
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