IN SEARCH OF “PEMBANGUNANBERKELANJUTAN” (A CASE STUDY OF
ENVIRONMENTAL ISSUES AND JAPANFOREIGN DIRECT INVESTMENT IN
INDONESIA IN 1980-2010)*Pembangunan Berkelanjutan is Indonesian words forsustainable development

AGENDA
Mauna Loa Report vs Percentage of Pollutants in
Each Country
Environmental Policy in Japan and Indonesia
Vertical FDI Level in Indonesia
Conclusion

MAUNA LOA REPORT VS PERCENTAGE OFPOLLUTANTS IN EACH COUNTRY
Data sets from :a.Mauna Loa
b.US-EPA
c.NBCC Republic of Indonesia
d.Ministry of Enviroment Government of Japan

MAUNA LOA REPORT VS PERCENTAGE OFPOLLUTANTS IN EACH COUNTRY
YearAverage Green Interpolated
IndonesianPercentageof Percentage
ofHouse Gases
GreenHouse Average Green Indonesia GHG Japan GHG inGases
House Gases
in the world
the world

1980

338,68338,68

36,11

23,71

11%

7%

1990

354,35354,35

35,50

20,98

10%

6%

2000

369,52369,53

33,72

18,48

9%

5%

2010

389,85389,84

27,89

15,59

7%

4%

1.Numbers are in parts per million (ppm)
2.Data source obtained from Mauna Loa report for Average GHG and Interpolated GHG
3.Data Source for Indonesia and Japan is average comparison data from US-EPA, NBCC, and MOE. Extra measurement was include byobtaining data from world bank and UN Statistical Divisions.

MAUNA LOA REPORT VS PERCENTAGE OFPOLLUTANTS IN EACH COUNTRY
The trends of GHG both in Japan and Indonesia are
decreasing although there is a percentage shares that
increasing but still in overall it was decreasing
Starting from 1980, the positions of Japan in terms ofpercentage is already lower than Indonesia, conclusion that I
can make is geographically Japan landscape is smaller thanIndonesia, and this had a significant impact to GHG emission
since the larger the area, established industry will be larger.
Second arguments are, it was related to populations. IPCC
always stated a relations between human activities and theircontribution to the global warming. Indonesia populations waslarger than Japan, means that human activities are bigger
than Japan. This was related to consumption of energy thatproduce GHG.
IPCC report in 2008, clearly stated that 60% of global
warming that happen in the world was contributed by humanactivities. This make an assumption that population issues isa crucial issues to climate change and global warming issues.

ENVIRONMENTAL POLICIES (JAPAN)
Basic Environmental Law (Law no.91 year 1993,
ratified on November 13, 1993 and amended in
1997 by Law no.81 of 1997)
Law concerning the promotion of procurement of
eco friendly goods and services by the state andother entities (Law on Promoting GreenPurchasing) (Law no 100 of 2000)
Law concerning the promotion of businessactivities with environmental consideration by
specified corporations, etc., by facilitating accessto environmental information, and othermeasures (Law no.77 of 2004)

ENVIRONMENTAL POLICIES (INDONESIA)
Basic Establishment Law of Ministry ofEnvironment Republic of Indonesia (Law No.4Year 1982)
Law about the usage of natural resources (Lawno.5 Year 1990)
Law about the legalization and adaptation ofStockholm Convention on persistent organic
pollutants (Law number 19 year 2009)

ENVIRONMENTAL POLICIES (CONCLUSION)
Conclusion that I can take from amendments point ofview are, the problems are in the matters of applying
the new law to public.
Applied a new law need a lot of compensation fromthe government in terms of cost, this is (so far) why inthe case of Indonesia it is not in line with thepollutant levels.
There are no significant correlations of establishment
or amendments of new environmental policies
because the trends of pollutant level is decreasing thisbecause the indicator of pollutants is getting bigger
therefore percentage from countries are look smaller
and going into a positive way. But overall there are nostrong and clear relations between this two.

VERTICAL FDI
NoYear

Percentage of FDI
to GDP

1

1980

0,132

1990

0,96

3

2000

-2,7642010

1,94

VERTICAL FDI
We can see that the percentage of FDI inIndonesia are very small in comparison withGDP make it not reliable at all if we linked all of
this into the effect of environmental policies thatpushed towards Japanese government policies
that performed FDI in Indonesia. Even though
the level of vertical FDI from Japan is thehighest in Indonesia, it doesn’t make sense how it
can affected a pollutant level if percentage of FDI
is only around 1% ?. Start from this I can saythat there are no strong relations between FDIlevel and pollutant level in Indonesia.

RESULT AND CONCLUSION
Both EKC and PHH are talking about Pollutantlevel will going hand in hand with GDP, so when
GDP is increasing automatically pollutant level
will be increasing too, PHH as the extension ofEKC said that there was another factor thatshould be included to see the relations between
economy (GDP) with pollutant level which isexport and import. Based on this two arguments
I performed a research that challenge thisarguments.

RESULT AND CONCLUSION
Result from the first phase we can see that it is nottrue that pollutant level is increasing soon after GDP
is increase. Both data of Indonesia and Japan showsthat there is a positive trends of pollutant level. This
result appear because there are 1 factors that EKC
and PHH forgot to put on as a factor, population
growth. Indeed the level of pollutant in the world as
in total average is increase but this cannot just be
blame to Indonesia and Japan. It is really possible tosaid that the trends in these two countries aredeclining but in other countries is increasing,
therefore there is “filling the box” assumptions about
this. One country loss but one country gain.

RESULT AND CONCLUSION
Result from the second phase we can see that
establishment of environmental policies in Japan does
not promote any Vertical Foreign Direct Investment
performed by Japanese Company. There is no clear
relations we can see between these two. Things thatenhance Japan in decreasing the pollutant level are
the system that running by Japanese Government
and in fact the percentage are pretty much stagnant
in Japan, this mainly because there are only small
chance to do vertical investment in Japan sincelimitation of the area and expensive cost ofestablishment (this including tax as well). In other
hand in case of Indonesia, they actually established astrict rule as well in terms of environmental policies
the problems are in the matters of applying the newlaw to public. Applied a new law need a lot ofcompensation from the government in terms of cost.

RESULT AND CONCLUSION
Result from the third phase are there phase are there
are no strong relations (perhaps I can say very weakrelations) between vertical FDI performed byJapanese government to pollutant level in Indonesia.
This because the percentage of FDI is only around 1%
to the GDP and infact the trends of pollutant level isgoing to a positive way.
Globalization that brought up modernization and newfactors to be notice make EKC and PHH a little
unrealistic nowadays. This might work if we calculate
it as in Global number instead only a relations
between 2 countries. Facotrs such as population
growth, advance technology, and application to public
are the key factors that could keep country tracking
down their performance along with pollutant level.

REFERENCES
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Dirty Industry in the world economy, (1960 – 1995)”. OECD Conference Paper
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Mathys, Nicole Andrea. “In search of evidence for the Pollution haven
Hypothesis”, Universite de Neuchatel; Division economique et social; Memoirede licence; Annee Universitaire 2001-2002. June 2002
Kuznets, Simon. “Economic Growth and Income Inequality”. In The American
Economic Review volume XLV. March 1955.
Suri, Viviek and Chapman, Duane.”Economic growth trade and energy:
implications for the environmental kuznets curves”, in Journal of Ecological
Economics 25 (Page 195-208). 1998 Elsevier Science B.V.
Government of Indonesia: Ministry of Environment “Law Number 19 Year 2009about legalization of Stockholm Convention Persistent Organic Pollutants”,
Ministry of Environment-Republic of Indonesia. 2009
Government of Japan: Ministry of Environment “Law Number 77 of 2004 Law
Concerning the Promotion of Business Activities with Environmental
Consideration by Specified Corporations, etc., by Facilitating Access toEnvironmental Information, and Other Measures (Provisional Translation)”,Ministry of Environment – Government of Japan. 2004
International Panel of Climate Change “Mauna Loa Monthly Report”:
Statistical Division of IPCC. February 2013.

“CONTROLLING CARBON IS ABUREAUCRAT’S DREAM. IF YOU
CONTROL CARBON, YOU CONTROLLIFE.”(DR. RICHARD LINDZEN,1992)