JAKARTA, INDONESIA – The Government of Indonesia and Asian Development Bank (ADB) will develop sustainable alternative livelihoods in coastal communities, reform the country’s social security system, improve households’ access to financial service, and enhance financial sector governance and risk management with projects financed by the Japan Fund for Poverty Reduction.
The ceremony today saw ADB Country Director for Indonesia Jon D. Lindborg, and Director of Funds from the Indonesian Ministry of Finance Ayu Sukorini exchanged letters of agreement for the four projects.
Grant assistance of $2 million is aimed at benefiting poor coastal communities in Berau district, East Kalimantan, under a pilot sustainable livelihood model. The area is part of a transboundary priority eco-region under the Coral Triangle Initiative. Held in coordination with other coastal area activities conducted in the area, the project is expected to reduce fishing pressures and improve the area’s marine ecosystem.
In addition to its grant assistance, ADB will also administer three technical assistance projects. The first project of $800,000 aims to reduce vulnerability of the poor to sudden economic shocks through reforms to the social security system in line with the Government’s National Poverty Reduction Agenda.
The second technical assistance project of another $800,000 will ensure that people in Aceh and North Sumatera have improved access to financial services. This will be done by providing support to provincial governments, local banks, and community-based producers to ensure sustainable and commercially-viable microfinance programs.
The third technical assistance project of $1 million will focus on enhancing the financial sector governance and risk management. By supporting Government's efforts in developing Integrated Financial Services Authority (OJK), deepening its capital market’s services, and increasing the demand for domestic capital market instruments, the project will strengthen the financial sector and boost growth in capital markets.
“ADB appreciates the grant funding provided by the Government of Japan for these activities, which support more inclusive, environmentally-sustainable growth,” Mr. Lindborg said in his remarks. “These projects will benefit from a community-driven approach and a focus on strengthened public financial management and regulation.”