The United Nations Development Program (UNDP) Indonesia encourages young people to start investing in a wise and smart way. The increase in investment is believed to be able to boost the economic development of a nation and accelerate the achievement of the SDG agenda or the Sustainable Development Goals.
UNDP Indonesia Head of Communication Tomi Soetjipto said the current investment trend has reached a fundamental change because everyone can choose and decide on their instrument in the most convenient way. Through various investment applications for example, everyone can invest their money in seconds.
However, these changes are not accompanied by financial literacy on how to choose wisely based on the credibility of financial instruments. Furthermore, whether the financial investment is safe and beneficial for the wider community is also unknown to many. According to Tomi, the Indonesian government has currently issued various financial instruments that involve financing by the public, such as SDGs Bonds to Green Sukuk.
This financial instrument, he said, is safer and more useful because it can contribute to the country, which is used for sustainable development or environmentally friendly projects, in accordance with international standards.
“A lot of young people’s money is easily lost through unsafe investment schemes. It’s a shame, because the ease of investment is also easy to lose. So, we are talking about how to attract young people’s investment to Indonesia’s development projects,” said Tomi in #SDGTalks: Smart Investment for Smarter Generation.
Cooperation with Indonesia
National Project Manager, Assist UNDP Indonesia, Nila Murti said, her party has long been working with the Indonesian government on how to encourage the younger generation to be able to invest wisely and smartly. One of them is by supporting the Ministry of Finance to issue Green Sukuk, which in 2018 were issued by the government.
Nila explained that UNDP’s support since the issuance of the SDGs Bond and Green Sukuk is categorized into three pillars. First, the technical system, namely the preparation of the framework, the selection of projects that match the criteria in the framework, to ensure that the projects financed meet the criteria.
Second, capacity building, namely as a process of increasing knowledge and skills related to green sukuk and others. And third, campaign and advocacy. We conduct campaigns related to risk and awareness regarding financing instruments to the younger generation.
Issuance of Green Sukuk
Then, Director of State Debt Instruments DJPPR Ministry of Finance Deni Ridwan also revealed, since the issuance of green sukuk or green sukuk from 2018 to 2020, it has succeeded in reducing emissions of 10.3 million tons of carbon dioxide equivalent. According to Deni, millennial investors who start investing in Government Securities (SBN) can help the economy so that development financing can also be more independent.
“Many of my friends have asked why the government is still in debt, because we hope that there will be greater contributions from domestic investors. Why are we targeting the younger generation? Because millennials hope that they are still in high school or college, or work, after knowing the benefits of investment, it is hoped that in the future Indonesia can get long-term financing sources from domestic, without depending on foreign investors. So we have independence in terms of development,” he said.
Deni said that his party’s records show that 40 percent of the millennial generation have become domestic retail investors in Indonesia. In fact, there are about 1 percent of Generation Z, namely high school students, who have also started to invest.
“The current condition of our financial sector is dominated by banks, where the management of funds is short-term. Meanwhile, we need to finance the development from long-term sources. For example, the construction of bridges, airports and other facilities, it certainly takes a long term. For that the government in this financing is not only pursuing the amount, but also wants to try to develop the financial market.
All three said, the younger generation must ensure and know that the investment they choose can be used for programs that are credible, can be accounted for and the results can be felt. In addition, the selection of investment instruments must also be adjusted to the characteristics of the user.