The Politics of Green Capitalism: Formulating the Low Carbon Growth Partnership Between Japan and Indonesia

Green capitalism is a term that emerged as capitalists' response to the ecological crisis in which capitalist system can continue to grow by creating sustainability and applying market efficiency in nature commodities. Despite the fact that Japan has no longer committed to the Kyoto Protocol, Japan has been involved in green capitalism by establishing the East Asia Low Carbon Growth Partnership (LCGP) since 2011. Through the LCGP, Japan has proposed proposals which review emissions target of Greenhouse Gas Emission (GHG) from a zero base and developed bilateral offset mechanism referred as the Joint Credit Mechanism ( JCM) to evaluate the contribution of CO2 emissions reduction from energy outside the country. This paper explains the cooperation between Japan and Indonesia in implementing JCM. By utilizing domestic politics analysis, this paper argues that even though the implementation of green capitalism reflects the interests of trade and investment between Indonesia and Japan, however, it also highly influenced by the interaction between domestic political groups (executive and legislative) and domestic societal interest groups in Japan's domestic politics. The implementation of LCGP between Japan and Indonesia, therefore, does not only display mutual interest on trade and investment of both parties but also reflects a compromise between different domestic political actors' position on climate change issue in Japan. The cooperation also indicates the green capitalism is possible in the form of government cooperation to deal with the environmental issue yet it is still acceptable from business community's point of view.   Keywords: Green Capitalism, Low Carbon Growth Partnership, Domestic Politics Analysi