IFAD in Indonesia

Since 1980, IFAD has extended loans to Indonesia for 15 programmes and projects totalling US$409.9 million. Eleven of the programmes and projects have been completed, and four are ongoing. IFAD has also funded a number of country and regional grants to support investment projects in the country.

Over the last 35 years, IFAD and the Government of Indonesia have been investing almost US$1 billion in rural people to strengthen inclusive and environmentally sustainable economic growth:

  • IFAD's projects are successful in the most remote and vulnerable areas of the country that also usually have the highest incidence of poverty. In Papua, for example, where many development projects previously failed, the IFAD-supported National Programme for Community Empowerment in Rural Areas promoted community assistance and better farming techniques and empowered women to take up income-generating activities.
  • IFAD supports coastal communities by decreasing their vulnerability to climate change shocks and by increasing their income from fisheries activities. Fisheries has a large potential to improve food security and enhance economic growth in Indonesia.
  • IFAD has successfully facilitated a number of public-private partnerships, both with international corporations and national companies in order to maximize impact and resources. Given Indonesia's significant commodities production potential, collaboration with the private sector is seen as a priority. This will enable smallholder farmers to gain benefits, such as increased production of high-value crops. IFAD is well placed to implement these partnerships.
  • IFAD supports an enabling policy framework. An effective agricultural and fisheries sector requires a supportive regulatory and policy environment. IFAD has the knowledge, international experience and resources to support the development of effective programmes and policies for smallholders.

Under the interim country strategic opportunities programme (COSOP) for Indonesia for the period 2014 to 2015, the overall objective of IFAD's interventions in the country is to support the government in achieving its development targets related to the agricultural and fisheries sectors. It also aims to empower smallholder producers to become more productive and better integrated with markets to achieve enhanced food security, increased incomes and reduce poverty and vulnerability.

The government has renewed its commitment to the empowerment and protection of smallholder farmers. Through its ongoing portfolio of projects and non-lending activities, IFAD will assist the government in undertaking this task and will pursue the following three objectives:

  • Strengthened institutions and capacity of smallholder producers in the agriculture and fisheries sectors;
  • Enhanced productivity and marketing of the produce of smallholders; and
  • Increased capacity of government to put in place a regulatory and policy environment to support smallholder producers.

Securing gender balance, enhancing sustainability of investments and building resilience to climate change will be emphasized in all IFAD initiatives.

With the opening of an office in Indonesia in 2015, IFAD will move closer to its partners on the ground and further deepen its engagement in the country.

Case study: Brokering  Development: Enabling Factors for Public-Private-Producer Partnerships in Agricultural Value Chains

Source: IFAD