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Minister of Communication and Informatics Budi Arie Setiadi has called on investors in the information, communication, and technology (ICT) sectors to consider Indonesia as a prime destination for artificial intelligence investment. His invitation comes in light of impressive data showing that AI’s contribution to the ASEAN economy skyrocketed from $1 billion in 2020 to $11 billion in 2022.
Minister Setiadi noted that while private investments in the AI sector are predominantly funnelled into the US, China, and the UK, the digital sector in the ASEAN region is experiencing rapid growth, with significant increases in ICT sector investments. “The digital sector continues to grow rapidly in the ASEAN region, with investment in the ICT sector increasing,” he stated during a recent address.
Earlier, Deputy Minister of Communication and Informatics Nezar Patria expressed views similar to those of Minister Budi Arie Setiadi regarding Indonesia’s potential to become a centre for AI development in ASEAN.
Deputy Minister Patria underscored the importance of collaboration among domestic stakeholders to create the necessary policies and initiatives to harness AI’s full potential. He highlighted the government’s issuance of a circular on AI ethics, which focuses on inclusion, transparency, security, and respect for human rights, ensuring that AI benefits all segments of society.
Additionally, Deputy Minister Patria mentioned the role of the Artificial Intelligence Industry Research and Innovation Collaboration (KORIKA) in fostering AI innovations and facilitating discussions through the annual AI Innovation Summit.
He also noted that ASEAN has introduced guidelines on AI governance and ethics to promote responsible AI development in the region, aiming for accountable and inclusive use that enhances people’s welfare.
In Indonesia alone, the digital sector attracted approximately US$ 22 billion in investment in 2023, and projections indicate that the market potential could reach between US$ 210 billion and $360 billion by 2030. Minister Setiadi emphasised that AI is poised to play a crucial role in this growth, with an expected contribution of US$ 366 billion to the Indonesian economy by 2030.
The minister underscored the promising potential of AI, highlighting its role as an emerging technology gaining traction across various sectors. He referenced a survey indicating that 73% of 700 global AI developers anticipate AI adoption within their organisations in the next two years. Minister Setiadi believes that AI can provide innovative solutions across multiple sectors in developing countries, including education, health, public services, finance, and labour.
Furthermore, Minister Setiadi envisions AI as a tool to promote digital equality, facilitating improved access to digital services, especially in rural and remote areas. He remarked, “AI has the potential to increase economic productivity through automation and innovation, enabling micro, small, and medium enterprises (MSMEs) to compete in the digital era.”
However, Minister Setiadi acknowledged the challenges Indonesia faces in becoming a suitable investment destination for AI. Key obstacles include uneven infrastructure development and limited funding, which hinder internet penetration – essential for AI growth.
Additionally, he pointed out the lack of knowledge transfer from countries with advanced AI capabilities, which restricts the establishment of effective AI governance in Indonesia.
Former Indonesian President Megawati Soekarnoputri called on academics to take the lead in guiding AI development, ensuring it serves to protect humanity and foster social harmony. She urged global governments to prevent the misuse of AI, highlighting its potential for weaponisation in the context of geopolitical tensions. She
To overcome these challenges and fully realise Indonesia’s AI potential, Minister Setiadi encourages collaboration among stakeholders within the national digital technology ecosystem. By harnessing the opportunities presented by AI, Indonesia can position itself as a leader in the digital landscape, driving significant economic growth and innovation in the years to come.
