Dialogue Series IV on Information and Communications Technology (ICT) & e-Commerce

Jakarta, 24 June 2015

Dialogue Series IV on Information and Communications Technology (ICT) & e-Commerce

Jakarta, June 24th 2015. Communication is an inseparable element of our daily activities. From traditional form, in which people interact through face-to-face, to sophisticated forms of wireless, cloud-based data transmission, to on-line shopping.

This is the new era for the Indonesia’s ICT sector. Serving nearly 100 million internet users (source: APJII, Indonesia Internet Services Provider Association), effective and efficient ICT infrastructure is mandatory. But, there are prices to pay.

E-Commerce, which paves the way to limitless opportunity of transactions, is perceived as one of the most potential sectors to increase economic growth. Online ecosystem will also generate more taxes for the State. For both private sectors, regulators and academicians, dialogue about e-Commerce and its components is very relevant to ensure an evidence-based policy as well as taking into considerations best practices from other countries.

“The Government has announced Indonesia Broadband Plan (IBP), which aims to build national broadband connectivity. It enables innovation and new opportunities across industries. In fact, many regulations in e-Commerce are not on-the-ground. e-Commerce is still in the Negative List of Investment while it should be borderless,” recited Mr. Alexander Rusli, ISD Board of Founders & President Director PT. Indosat Tbk., while giving welcoming remarks to ISD Dialogue Series IV on ICT Services and e-Commerce.

Following the point made by Mr. Alexander Rusli, Mr. Kristiono, Chairman of Indonesian Telecommunications Society (Mastel) stated, “The discourse of luxury tax for mobile devices is quite confusing, since mobile devices are no longer luxurious goods; they should be considered as capital to increase productivity, not consumer goods.”

While we discuss about technical mechanism in developing ICT sector and e-Commerce, we should not forget that development of human capital which is a big issue to address. With skilled people, Indonesia could be “actors” instead of “spectators”.

“By 2017, Indonesia could be the biggest market in Southeast Asia if we do it right. We should increase our education sector to keep-up with the recent technology and include the private sector participation in the policy drafting,” explained Mr. Daniel Tumiwa, Chairman of Indonesian e-Commerce Association (idEA) & CEO OLX Indonesia, while presenting about e-Commerce potentials in Indonesia.

Keeping-up with the most recent recent technology is key, especially when trend is transforming very swiftly. Mr. Antonius Ardian Bermana, Group Head Corporate Planning & Analysis PT. Indosat Tbk., confirmed that demand for data-services increase rapidly, whilst a replacing text messaging and phone calls.

Meanwhile, Mr. Rudiantara, Minister of Communication and Information Technology Republic of Indonesia, who attended Dialogue Series IV as the Keynote Speaker, said, “By 2014 total transaction in Indonesia’s online market was US$12 billion or IDR 150 trillion. In the same period, China scored US$430 billion, three times larger than Indonesia’s Annual State Budget. e-Commerce potential in Indonesia is breathtaking. By 2019, it is forecasted that Indonesia’s online market may increase up to US$140 billion, again if we do it right similar to China with its strategy.”

With that fantastic number, Indonesia will surely transform into the next e-Commerce power. Meanwhile, accelerating the development of ICT infrastructure would be a quick win for the Government and private sectors. World Bank research indicates that 10% increase in broadband penetration can trigger 1.38% economic growth in developing countries. Hence, Indonesia could increase its national economic growth by simply debottlenecking some inefficiency caused by the lack of ICT infrastructure.

“Providing digital services for economic activities is one of key elements to increase national competitiveness. Digital financial inclusion, digital platform for business namely e-Logistic, e-Commerce, e-Payment, e-Procurement, and digital services for public such as e-Book, e-Banking, e-Health, e-Money, and e-Ticketing should be provided,” said Prof. Kalamullah Ramli, the Director General of Post and Informatics, Ministry of Communication and Information RI, during the interactive Panel Session.

Regulatory framework, payment method, security, and taxation are subject of discussion in the ICT and e-Commerce sectors. In the coming months, two important milestones will be finalized: Draft of Government Regulation for e-Commerce & e-Commerce Roadmap.

“Draft of Government Regulation for e-Commerce, which encompasses identity of business, product specification, payment method, and delivery mechanism, is currently being finalized,” confirmed Ms. Fetnayeti, the Director of Domestic Business Development and Enterprise Registration, Ministry of Trade RI.

“Indonesia will do the best in the preparation of the e-Commerce Roadmap to foster growth in line with customer protection, reliable national payment system, and links it with reliable logistic and courier services,” added Mr. Eddy Satrya, Deputy Assistant of ICT and Utilities, Coordinating Ministry of Economic Affair RI.