What’s Wrong With Our Carbon Productivity?

What’s Wrong With Our Carbon Productivity?

“Green economy” rolls off the tongue. Proof doesn’t. If we had to defend that claim with numbers, what would we show?

Carbon productivity is a good test. It measures how much value an economy creates per ton of GHG emissions. It’s simple, almost unforgiving: how much output do we generate for every ton we release? Once you track it, you can see the difference between real progress and polished talk. When this figure rises, it’s a sign that the economic engine is becoming more efficient, the technology is getting cleaner, and the value-add is increasing. Carbon productivity also has a very practical side. It’s about competitiveness.

Indonesia faces a unique challenge in measuring emissions: our massive forest and land fires. Because these events can cause emission spikes in specific years, they often cloud the underlying trend. To get a more stable and accurate reading of our industrial and economic efficiency, it is better to focus on Non-LULUCF emissions (excluding the land and forestry sectors) and compare them against nominal GDP. This approach filters out the “noise” of forest fires and avoids the technical sensitivities that come with shifting base years in constant GDP calculations.

Look at the long arc and Indonesia’s story is actually impressive, at least at first. Between 1998 and 2013, our carbon productivity jumped 5.6 times. In 1998, every ton of non-LULUCF emissions produced roughly USD 343 in GDP. By 2013, that same ton was associated with about USD 1,921. That is what real progress looks like.

Then the plot stops moving. Since 2014, the needle has barely shifted. For a full decade (2014–2024), carbon productivity has stayed stuck in a narrow band, around USD 1,680 to USD 1,905. We’re not advancing. It’s the economic version of running hard on a treadmill: lots of effort, not much distance.

A flatline like this is rarely accidental. It’s a signal that the carbon efficiency of our growth engines has stopped improving at speed. Our energy mix hasn’t cleaned up enough to unlock the next leap, while the economy still leans heavily on activities that burn a lot to produce a little.

If we stay on this path, the cost of future growth will inevitably rise due to energy burdens, the risk of stranded assets, and mounting global pressure on the carbon footprint of our products. If we keep growing the old way, we’re not building a green economy. We’re just making the bill bigger.

The shift we need is simple to say, harder to do: move from emissions-heavy expansion to value-added upgrading. That means cleaning up the grid fast, rewarding industries that invest in efficiency and clean tech, and building a smart carbon pricing system, not only to signal what’s costly, but to help pay for what’s cleaner.

We need to synchronize our efforts and move fast. At the end of the day, a successful climate transition isn’t proven by speeches but by honest numbers.