(Feb News) Surabaya, March 18, 2025-Towards the deadline for achieving sustainable development goals or sustainable development goals (TPB/SDGs) in 2030, UNICEF Indonesia strengthens its commitment to the fulfillment of children's rights through support for the innovative financing approach in East Java, namely with integrated sub-national finrancing framework (ISFF). Developed in collaboration with Universitas Airlangga, ISFF became a strategic instrument to integrate public and innovative financing, while encouraging transparency, accountability, and harmony with regional development priorities.
Children as a priority: Challenges and opportunities in East Java
as a province with a child's population reaching nearly 9 million, East Java have shown progress in the education sector, with high school participation rates reaching 89.26%in 2023. However, significant challenges are still overshadowing, especially in terms of high -stunting children, namely 17.7%, and poverty levels of 9.79%, which contributes to limited access to education, health services, and other basic needs. The ISFF framework is designed to place children as a center in making development financing decisions, by giving priority to investment in the health, nutrition and education fields.
To be able to reach the SDGs target in 2030, East Java is estimated to require a total financing of around Rp2,300 trillion. This figure shows how urgent the need for innovative and collaborative financing. With the full support of Universitas Airlangga , ISFF has developed into a multi-stakeholder collaboration container, which not only strengthens the capacity of local governments, but also encourages the active involvement of the private sector to create a sustainable development impact.
FGD One Vision: Cross-Sector Support for ISFF
To strengthen the foundation of ISFF implementation, three Focus Group Discussion (FGD) sessions were held in February to March 2025, which involved cross-sectoral actors, with the following details:
1) Capital Market Sector-involving the Indonesia Stock Exchange (BEI) East Java which focuses on the Capital Offering through the Capital Offering (IPO) green and social bonds. In this discussion, IDX highlighted the importance of the role of Green Bonds and Social Bonds in supporting the financing of projects that focus on children, while identifying challenges in the form of financial literacy gaps and the discrepancy of the CSR program with the real needs of the community.
2) Islamic Financial Sector-This FGD involves institutions such as Baznas, Lazismu, YDSF, LMI, and others, which together discuss the strategy of alignment of zakat, infaq, sadaqah, and waqf (ziswaf) funds with the aim of financing ISFF, so that the management of religious funds can be more directed in supporting inclusive and equitable development.
3) Financial Sector and the Private Sector - This discussion also presents representatives from Bank Indonesia, East Java Financial Services Authority (OJK), Directorate General of Treasury of the Ministry of Finance of East Java, Bank Jatim, Bank Muamalat, Indonesian Syariah Bank (BSI) Surabaya, as well as Chamber of Commerce and Industry (Kadin). The focus of the discussion is on the optimization of SDGs project financing through the green finance approach (green finance), micro financing, and government cooperation schemes with business entities (PPP).
Although the ISFF initiative has gained positive momentum, stakeholders also recorded a number of challenges that needed to be immediately handled. Among these are the low financial literacy of the community, regulatory barriers that limit financing innovations, as well as a lack of adequate monitoring and evaluation system to ensure accountability in the implementation of investment that focuses on children's welfare.
ISFF emerged not only as a financing framework, but also as a model of innovation and collaboration across sectors, which strengthened East Java's readiness to form a new and sustainable new development landscape. By utilizing strategic resources and partnerships, ISFF provides this province with tools and networks to create a real impact for future generations, and prove that financing in favor of children is the best investment for the future.
