Information Technology in Indonesia and Its Digital Economy Opportunities

    

    Technological advancements of all societies across the globe are being transformed, the way people live, work, and play were refined. Developments in connectivity and computing power, along with technologies such as automation, machine learning, and artificial intelligence.

    Digitalization offers Indonesia a chance to accelerate its economy and offer new growth opportunities to its people. The rapid development in the information technology sector, combined with drives like a mass consumption of products, urbanization, a surge in mobile usage, and a tech-hungry young population, makes a positive impact on the economic growth in Indonesia.

According to International Data Corporation, Indonesia has become the largest spender on Information Technology (IT) in Southeast Asia. They ranked #1 in terms of GDP growth whilst maintaining a low 3.79% rate in inflation. The public sectors invest heavily in upgrading their internal infrastructure, and the private sectors do so as well to enhance customer service in order to gain a competitive edge in the marketplace.

    In 2025, Indonesia will have a massive 125 million internet users. The growth of internet usage has further encouraged Indonesians to purchase smartphones, subscribe to monthly data packages, and make online purchases. Leveraging these trends in Indonesia, there is a disruptive force of information technology in the next few decades to come. Indonesia is now catapulting itself to the global online marketplace.

    Indonesia's digital roadmap 2021-2024 will accelerate the country's digital transformation agenda. The roadmap focuses on four strategic sectors.

1. Digital Infrastructure. It includes 224, 573 km of terrestrial and 123, 869 km of subsea fiber-optic backbone, 550, 020 base transceiver stations, and five Gbps of satellite capacity consisting of 5 national commercial telecommunications satellites under a lease.
2. Digital Government. Indonesia is also in the process of consolidating and integrating various government data under the One Data Indonesia initiative. This initiative is formalized by Presidential Regulation 39/2019 and aims to create quality and accessible data, that can be shared across the central and regional agencies.
3. Digital Economy. Indonesia is well on the way to becoming a major contributor to the global digital economy. The Indonesia government is focusing on the digital onboarding of more than 64 million micro, small and medium enterprises (MSMEs) across the country, encouraging them to ‘Go Digital and Go Global’. The government is targeting 30 million MSMEs to go digital by 2024. Indonesia is also looking to foster a start-up ecosystem, and the government has launched initiatives such as the 1000StartupDigital movement. Indonesia holds the record for producing the greatest number of unicorns in Southeast Asia, and one ‘Decacorn’ (a startup with a valuation exceeding US$ 10 billion). The GoTo Group, recently formed by the merger of GoJek and Tokopedia, is developing a super app encompassing eGovernment, transport, education, logistics, financial services, and communications. President Jokowi is encouraging Indonesia to produce start-ups in the financial services, industrial, entertainment media (digital broadcasting), agriculture and fisheries, education, health, and real-estate/digital cities.
4. Digital Society. The Indonesia government recognized that digital society forms the foundation of a thriving digital economy. The success of the nation’s digital transformation is dependent on society’s readiness to adopt digital. In response, the government prepared a Three-Tiered (Basic, Intermediate, Advanced) Digital Talent Development approach. The first tier aims to provide basic digital skills for the public in general. The target is to provide 12.5 million Indonesians with pieces of training in basic digital skills, digital culture, digital ethics, and digital safety. The second tier aims to provide at least 100,000 fresh graduates, technicians, and professional level workers with intermediate digital skills in areas such as cloud computing, artificial intelligence, the internet of things, cybersecurity, and big data analytics. The third tier aims to provide advanced digital skills for decision-makers in the public and private sectors. The government is targeting to have 300 participants trained and certified.