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Indonesia’s Digital Economy Makes Huge Gains

Investment in the Indonesian digital economy has increased significantly. The country secured a US$ 3 billion investment deal value in the first quarter of 2022, the second largest value after Singapore. With the sector’s favourable performance, its valuation is predicted to quadruple to USD 130 billion in 2025 and reach USD 220-USD 360 billion in 2030.

Indonesia has become a prominent player in the ASEAN digital economy, accounting for almost 40% of the overall value of ASEAN digital economy transactions. According to a recent study in 2022, Indonesia’s digital economy reached US$77 billion last year, a 22% increase from 2021. This success is further reinforced by the fact that Indonesia has a majority of the productive age population, more than 2,400 start-up enterprises, and is rated sixth in the world with the most significant number of start-ups, as well as an internet penetration rate of 76.8%.

“In the short term, the government help build awareness of the use of domestic products, strengthens and broadens access to KUR as a primary driver for MSMEs, governs inflation to maintain people’s purchasing power, and improves the domestic market,” said Airlangga Hartarto, the Coordinating Minister for the Economy, during a virtual keynote speech in Central Jakarta.

The national economy is demonstrating its robustness and recovering more swiftly due to more robust domestic economic fundamentals, such as consumption, investment, and exports. Furthermore, it is supported by the significant potential of digital economic growth in the last two years, one of which is motivated by people’s increasingly contactless behaviour, namely a greater reliance on e-commerce and on-demand businesses such as ride-hailing, online food delivery and online logistics.

During the 2023 ASEAN Chairmanship, the government will continue to improve the tourism sector through Special Economic Zones (KEK), develop downstream natural resource-based industries, diversify export markets, and promote the Digital Economy Framework Agreement.

In the long run, the government is dedicated to expediting the national economic recovery and improving resilience through enhancing competitiveness, investment, human resource (HR) productivity, and employment through the execution of the Job Creation Law and digital transformation.

Through synergy and collaboration between the national ride-hailing company and the government, particularly in the food and transportation sub-sectors, it will realise potential worth US$39 billion in 2025, expanding at 20% on average (CAGR 2022-2025).

To expand digital payment in the region, Indonesia’s Central Bank (Bank Indonesia/BI) collaborated with five ASEAN countries and the Philippines, Malaysia, Indonesia, Singapore and Thailand to facilitate cross-border payment using QR. The five ASEAN countries agreed on Regional Payment Digital Connectivity during a series of events during the G20 Bali Summit. The agreement will increase the availability of the Indonesian Standard Quick Response Code (QRIS) across five ASEAN countries.

The Ministry of Communication and Informatics welcomed the conversation. According to Usman Kansong, Director General of Information and Public Communication at the Ministry of Communication and Information (Kemkominfo), the ministry supports initiatives to integrate payment systems via QRIS ASEAN. The central banks of the five nations have met several times to discuss the implementation of cross-border payment system connectivity in the region.

Indonesia’s Ministry of Trade has updated internet trading legislation in response to the country’s more widespread development of online trading firms. The purpose of upgrading the Permendag is to boost MSME product competitiveness while eliminating unethical trading activities in the e-commerce market. Unfair competition tactics undermine the MSME structure and disrupt the trade structure of Indonesia.

Minister Zulkifli Hasan emphasised the importance of maintaining and optimising domestic online trade in the updated Regulation of the Minister of Trade (Permendag) Number 50 of 2020 regarding Provisions for Business Licensing, Advertising, Guidance, and Supervision of Business Actors in Trading Through Electronic Systems. Various public comments and proposals have proven critical to enhancing the act, such as social media commerce laws, cross-border transactions, and a ban on selling commodities on marketplaces.

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Qlik’s vision is a data-literate world, where everyone can use data and analytics to improve decision-making and solve their most challenging problems. A private company, Qlik offers real-time data integration and analytics solutions, powered by Qlik Cloud, to close the gaps between data, insights and action. By transforming data into Active Intelligence, businesses can drive better decisions, improve revenue and profitability, and optimize customer relationships. Qlik serves more than 38,000 active customers in over 100 countries.

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CTC Global Singapore, a premier end-to-end IT solutions provider, is a fully owned subsidiary of ITOCHU Techno-Solutions Corporation (CTC) and ITOCHU Corporation.

Since 1972, CTC has established itself as one of the country’s top IT solutions providers. With 50 years of experience, headed by an experienced management team and staffed by over 200 qualified IT professionals, we support organizations with integrated IT solutions expertise in Autonomous IT, Cyber Security, Digital Transformation, Enterprise Cloud Infrastructure, Workplace Modernization and Professional Services.

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Planview has one mission: to build the future of connected work. Our solutions enable organizations to connect the business from ideas to impact, empowering companies to accelerate the achievement of what matters most. Planview’s full spectrum of Portfolio Management and Work Management solutions creates an organizational focus on the strategic outcomes that matter and empowers teams to deliver their best work, no matter how they work. The comprehensive Planview platform and enterprise success model enables customers to deliver innovative, competitive products, services, and customer experiences. Headquartered in Austin, Texas, with locations around the world, Planview has more than 1,300 employees supporting 4,500 customers and 2.6 million users worldwide. For more information, visit www.planview.com.

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SIRIM is a premier industrial research and technology organisation in Malaysia, wholly-owned by the Minister​ of Finance Incorporated. With over forty years of experience and expertise, SIRIM is mandated as the machinery for research and technology development, and the national champion of quality. SIRIM has always played a major role in the development of the country’s private sector. By tapping into our expertise and knowledge base, we focus on developing new technologies and improvements in the manufacturing, technology and services sectors. We nurture Small Medium Enterprises (SME) growth with solutions for technology penetration and upgrading, making it an ideal technology partner for SMEs.

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HashiCorp provides infrastructure automation software for multi-cloud environments, enabling enterprises to unlock a common cloud operating model to provision, secure, connect, and run any application on any infrastructure. HashiCorp tools allow organizations to deliver applications faster by helping enterprises transition from manual processes and ITIL practices to self-service automation and DevOps practices. 

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IBM is a leading global hybrid cloud and AI, and business services provider. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Nearly 3,000 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM’s hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM’s breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and business services deliver open and flexible options to our clients. All of this is backed by IBM’s legendary commitment to trust, transparency, responsibility, inclusivity and service.

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