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Indonesia Encouraging Start-ups to be More Resilient in Adversity

Johnny G. Plate, Indonesia’s Minister of Communication and Informatics has encouraged digital startups to take three steps to increase resilience and avoid layoffs in his statement at the V Kominfo Digital Economy Forum (FEDK V). The “winter” is expected to impact the economy and the risk of stagflation (stagnation and inflation) is high. Hence, he encouraged startup founders to be creative and innovative to adapt to the coming hardships ahead.

The minister reminded tech startups that retrenchment would only solve one problem but eventually create new, more significant issues – efficiency does not mean only laying off employees. Digital startups should develop new approaches, create innovative business models to disrupt markets and provide solutions to various societal problems.

Indonesian digital startups could implement three action plans to remain resilient to face adversity.

“In a situation like this, we need (real) action. The first is compatibility with domestic products. Second, efficiency without sacrificing the workforce. Third, present a business model that can adapt to changing market conditions.” he said at the “Digital Startup Winter: Impacts and Challenges to Indonesia’s Digital Economy Development” forum.

The ministry arranged the forum in response to the ramifications of the pandemic and geopolitical changes. Such issues have impacted supply chains, finances, inflation and energy. As a result, most of the world’s countries are now facing economic pressures. Several Indonesian tech companies, including GoTo, Shopee Indonesia, Ruangguru, and others, have announced layoffs since early Q4 2022.

It is vital to embrace the problematic situation and rise to the challenge to forge new paths so that the nation can grow and become more resilient. With the digital sector’s help, Indonesia can face global challenges.

Tech entrepreneurs, executives, investors, incubators, associations and the government together must continue to support the digital economy ecosystem’s resilience. A multistakeholder collaboration is essential to maintain resilience in the tech sector, and indeed, all areas.

The minister urged entrepreneurs and businesses to use the Digital Innovation Network to keep startup funding sources active. In previous G20 meetings, the government pushed for the Digital Innovation Network, which is part of the Bali Declaration.

Another essential step in driving the digital economy is to support domestic products, particularly micro, small, and medium enterprises (MSMEs). Johnny requested digital economy actors to form a collective commitment to improve alignment with MSME players.

In addition, he highlighted the importance of purchasing and supporting domestic products. So far, with this strategy, Indonesia has maintained economic growth above 5%. “The MSME sector is Indonesia’s strong suit. Our MSME sector will also contribute to Indonesia’s digital economy, e-commerce, and other sectors,” said Jonny.

The FEDK V featured government representatives, CEOs, founders, and top leaders from the digital economy ecosystem. According to the problem statement proposed in the forum, each participant presented a strategic issue. Simultaneously, discuss and deepen based on each other’s understanding and experience.

Director General of Informatics Applications, Semuel A. Pangerapan, Director of Digital Economy at Aptika’s Directorate General, I Nyoman Adhiarna, and Director of Informatics Empowerment at Aptika’s Directorate General, Bonie Pudjianto, were present at the forum.

Bima Laga, Chairperson of the Indonesian e-Commerce Association (idEA), Markus L. Raharja, Secretary General of the Association for Venture Capital for Indonesian Startups (AMVESINDO), Tauhid Ahmad, INDEF Director, and Ibrahim Kholilul Rohman, Lecturer at the Faculty of Economics and Business, University of Indonesia, represented other stakeholders.


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