A mobile phone store in Jakarta, Indonesia (Photo: AFP/VNA)Jakarta (VNA) – Indonesia will focus on promoting e-commerce as a way to boosteconomic growth.
Accordingto Jakarta Post, President Joko Widodo will continue to focus significantattention on infrastructure development, with more focus on digitalinfrastructure, so as to bolster e-commerce opportunities as a way to stimulateeconomic growth.
E-commerceis seen as a good way that Indonesia could reach its 2025 target of7 percent annual gross domestic production (GDP) growth.
Thistarget is not necessary a pipe dream as some estimates predict Indonesia could account for 46 percent of Southeast Asia’s e-commercein value by the middle of next decade.
Thegrowing viability and importance of this sector is reflected by the large investments inIndonesian e-commerce businesses by the big Chinese tech companies such asAlibaba, Tencent and JD.com. Both Tencent and JD.com are investing heavilyin the Indonesian ride-sharing start-up and Indonesian e-commerce darlingGo-Jek. Go-Jek has also attracted investment from Google,the first direct investment from an American tech company in Indonesia.
BothGo-Jek and Singaporean rival Grab are in a race to become the biggest consumertechnology groups in Southeast Asia by expanding firstin Indonesia.
Theselandmark investments clearly indicate Indonesia’s growing importance as anemerging e-commerce market.
Thevoracious appetite for this service meant that in 2014 Indonesian’s were theworld’s most addicted smartphoneusers - based on a daily average of 181 minutes of screen time. Even thoughaverage screen time has increased to 206 minutes a day, Indonesia has nowretreated to having only the fourth highestrate of social media use in the world.
Not allIndonesians have equal opportunity in accessing the Internet. In urbanareas 72 percent of people have access compared withjust 48 percent of those in rural areas. An incoming Jokowi government willneed to focus on further development ofdigital infrastructure to help lift rural connectivity rates. Indonesia lagsbehind its neighbors on this front, only investing 1.3 percent of its GDPcompared to Thailand’s 2.4 percent, Malaysia’s 4.5 percent and Singapore’s 6.6percent.
Cateringto the needs of Indonesia’s young population will also be a major challenge.Twenty-four percent of Indonesia’s population are millennials of which 88percent want to start their own businesses.
Indonesia’sgovernment needs to develop the digital infrastructure and create opportunitiesfor them also - not only to stimulate economic growth but also to satisfy thempolitically.
To dealwith the issue, Indonesia needs a national digital roadmap, which will be afocus in the second working term of President Widodo.-VNA
