World Bank approves Indonesia loan, funding for clean energy and health

JAKARTA (Reuters) -The World Bank said on Tuesday it had approved a $1.14 billion project to expand access to cleaner electricity in Indonesia, for which it will provide $500 million in financial support, and $600 million toward a project to improve childhood nutrition.

The electricity project will connect about 2 million people to the electrical grid in eastern Indonesia, increase solar power investment and help Indonesia's state utility Perusahaan Listrik Negara (PLN) improve its capacity to manage energy transition, the World Bank said in a statement.

It will be co-funded by the World Bank, the private sector and PLN and includes funding from Canada Clean Energy and Forest Climate Facility and the Clean Technology Fund.

The project "will mobilise private sector finance for Indonesia's energy transition and help communities adapt to climate change," World Bank Vice President for East Asia and the Pacific, Manuela V. Ferro, said in a statement.

Indonesia, which uses coal for most of its electricity, aims to slash emissions by 32% by 2030 and reach net-zero emissions by 2060.

Separately, the World Bank said it had approved $600 million in financing toward Indonesia's efforts to curb stunting in children's growth, a form of malnutrition.

About 21% of Indonesian children under five had stunted growth in 2022, about 4.5 million children, according to a government survey issued in January.

Indonesian President Joko Widodo has said the country aims to lower the percentage to 14% in 2024.

(Reporting by Fransiska Nangoy and Stanley Widianto; Editing by Martin Petty and Christina Fincher)