Industry 4.0 is increasingly driving changes in the socio-economic order. Through a dense flow of information, opportunities in mapping trade patterns are increasingly varied along with the development of digital technology. A real phenomenon that is felt at the moment, especially in Indonesia, is that traders can have shops without having to own a building, and the convenience felt by consumers because they can choose various products according to their preferences without having to move from their location. There are also economic opportunities from digital trade to penetrate local and foreign markets.
Fig 1. e-Conomy SEA 2023 Report | Source: Google, Temasek, dan Bain & Company (2023),
Quoting reports from Google, Temasek, and Bain & Company (2023), state that amidst macro obstacles, the Indonesian economy is expected to recover and reach ~$110 billion in 2025, especially in the e-commerce sector. Of course, as the country with the largest economy in Southeast Asia, Indonesia increasingly has the opportunity to maximize the impact of advances in digital technology in achieving economic benefits.
Based on an article entitled Digitization for Economic Growth and Job Creation, Darwiche et al (2013) stated that policymakers can take advantage of the various impacts of digitalization through three main steps, (1). Create digitalization plans for target sectors where they want to maximize the impact of digitalization; (2). Encourage the development of capabilities and supports necessary to achieve digitalization plans; and (3). Policymakers must work together with industry, consumers, and government agencies to build an inclusive information and communications technology ecosystem.
Digital Transformation Strategy to Encourage Inclusive Economic Growth
Referring to the basic concept above, and reflecting on the pattern of the digital economy and electronic commerce in Indonesia, it can be described as follows:
Plan for digitalization of potential sectors.
The importance of a conceptual foundation in terms of maximizing potential sectors in the digital economy was stated by the Coordinating Ministry for Economic Affairs through the White Paper on the National Strategy for Development of the Indonesian Digital Economy 2030 through 6 (six) main pillars, which include (1). Infrastructure; (2). Human Resources; (3). Business Climate and Cybersecurity; (4). Research, Innovation and Business Development; (5). Funding and Investment; and (6). Policies and Regulations.
This framework can be a guideline for the government and the business world in taking advantage of Indonesia’s digital economic opportunities which are recorded as continuing to grow and have become the highest in Southeast Asia. Referring to the e-Conomy SEA 2023 report (Figure 1), the growth of the e-commerce sector still dominates, accompanied by growth in the transportation and food sectors, online travel, and online media, so strengthening foundations and strategies is very urgent.
Encouraging Development and Digital Support Capabilities.
Like two sides of a coin, namely the development of digital infrastructure needs to be accompanied by the development of digitally adaptive human resources (HR) because if this is not done, inequality will occur. This argument is in line with the efforts that have been carried out in Indonesia, some of which are the launch of the Republic of Indonesia Satellite-1 (SATRIA-1), the backbone network (Palapa Ring), and also the construction of various transmitting towers which are familiarly known as Transceiver Bases. Station (BTS). These various efforts are projected to encourage the digital economic growth ecosystem in Indonesia.
In addition, through the G20 agenda targets in 2022 in Bali, especially in the Digital Transformation sector, Indonesia has formed a Digital Economy Working Group (DEWG), which discusses 3 (three) digital transformation topics, including connectivity and recovery after the COVID-19; digital skills and digital literacy; as well as, cross-border data flows. There are also programs related to increasing human resource competency, such as digital communication and information and other similar programs implemented across government sectors.
Collaboration across Government, Industry, and Consumer sectors
This pattern is very important because digital transformation is very dynamic and the government will not be able to make implementable policies if it does not understand consumer behavior and preferences, and if it does not take into account industrial developments. Shifting Market Dynamic but Policies Slow to Catch Up, policies have an important role in improving the supporting ecosystem and expanding access to new opportunities, unfortunately, policies and institutions are slow to adapt to new challenges (Qureshi & Woo, 2022). This is social commerce (s-commerce), which was born through disruption in digital transformation as a concrete form of the need for the government to understand consumer trends and industrial movements.
Consumer trends in accessing and using social media are increasingly driving a shift in behavior, where consumers are now able to play more of a role than just passive consumers because they can also play an active role in providing reviews, experiences, and insights both in regular and live content. This phenomenon was captured by the industry by developing a platform concept that can facilitate the transaction process, which is generally in the form of e-commerce, so that it can refer directly to products reviewed by content creators via social media, making it easier for consumers to get products.
This condition is what makes s-commerce quite popular with the public. However, the government has set strict limits regarding s-commerce regulations to maintain trade patterns in supporting a competitive digital economy, through Minister of Trade Regulation Number 31 of 2023. This phenomenon underlies the idea that cross-sector collaboration and communication are very necessary in welcoming the digital economy. , so that the decisions issued do not cause polemics in society.
Conclusions
The era of the network society presents various disruptions in the conventional trading order. Digital transformation is increasingly pushing general boundaries in trade, presenting promising economic opportunities through electronic commerce. Indonesia welcomes this opportunity, and is trying to take advantage of the opportunity through various strategic programs, and therefore has now transformed into a country with the largest digital economy in Southeast Asia. However, the most important thing in maintaining and expanding the strength of Indonesia’s digital economy is careful planning, infrastructure development accompanied by the development of digitally adaptive human resources, and collaborative cooperation between government, industry, and consumers (society) in optimizing economic opportunities from electronic commerce.
