Indonesia’s Ransomware Attack: Lessons in Digital Risk Management for Smart Cities -Part 2

Cybersecurity vulnerabilities can open the door to attacks that harm public services and threaten sensitive citizen data.

Authors: Tuhu Nugraha and Raine Renaldi*

In the first part of this article, we identified various digital risks associated with the implementation of smart cities in developing countries. These risks include cybersecurity vulnerabilities, threats to data privacy, widening digital divides, dependence on foreign technology, and unforeseen social and economic impacts. In this second part, we will discuss strategies to mitigate these risks, ensuring that smart cities can achieve their desired benefits while minimizing potential negative impacts. Risk mitigation is crucial because, without proper preventive measures, these risks can hinder the development of smart cities and result in significant losses.

Cybersecurity vulnerabilities can open the door to attacks that harm public services and threaten sensitive citizen data. Threats to data privacy can erode public trust and lead to the misuse of data by irresponsible parties. A widening digital divide can exacerbate social and economic inequalities, while dependence on foreign technology can lead to exploitation risks and difficulties in adapting technology to local needs. Unforeseen social and economic impacts can also lead to unemployment and social tensions. Therefore, digital risk mitigation in smart cities is not just a necessity but also a strategic step to ensure the sustainability, inclusivity, and long-term success of smart city initiatives in developing countries.

Enhancing Cybersecurity Measures

To address cybersecurity vulnerabilities, developing countries must invest in robust and partially integrated cybersecurity infrastructure. This involves several key strategies to ensure comprehensive and layered protection. Governments must allocate sufficient funds for cybersecurity measures, including the development of comprehensive security strategies. Adequate budgets allow for the implementation of cutting-edge technology and support ongoing education and training initiatives in cybersecurity. Raising awareness about the importance of cybersecurity is also crucial. Awareness campaigns and training programs can help stakeholders understand the potential damage from cyberattacks and the importance of preventive measures. Additionally, investment in education and training programs to develop local expertise in cybersecurity is essential. Establishing specialized educational institutions and providing opportunities for certification and advanced training can build a competent workforce.

One advanced strategy in cybersecurity is the concept of a Partial Integrated System. This concept involves implementing layers in the security system where the main systems are separated from the more accessible ones. This way, space is provided for hackers to attempt access, but the most critical core systems are protected by additional, difficult-to-breach layers. Benefits of this system include reduced risk of damage, early detection, rapid response to threats, and flexibility and adaptability in system adjustments and updates. Implementing this strategy involves network segmentation, multi-layered firewalls, intrusion detection and prevention systems (IDPS), and training and attack simulations. With these measures, developing countries can build robust, partially integrated cybersecurity systems that provide effective layered protection against cyber threats and ensure the sustainability and long-term success of their smart city initiatives.

Strengthening Data Privacy Regulations

To protect data privacy in smart cities, the following steps must be taken. First, developing countries need to create and enforce strong data privacy laws that regulate data collection, storage, and usage. This legal framework must include clear guidelines on how to protect data and provide stringent consequences for violations. According to open sources, by 2023, it is estimated that over 148 countries worldwide have data protection laws (DPL). Second, strengthening institutional capacity to enforce data privacy laws is essential. This includes addressing corruption, increasing resource allocation, and enhancing the capabilities of law enforcement agencies to perform their duties effectively. Third, like cybersecurity, raising awareness about data protection among governments, businesses, and the general public is crucial. Education programs and public campaigns can highlight the importance of data privacy and the risks associated with poor data management. With these measures, data privacy in smart cities can be more secure, creating a safer and more trustworthy environment for all stakeholders.

Bridging the Digital Divide

To prevent the digital divide from widening, it is important to improve access to technology and enhance digital literacy. Governments and private sector partners must work together to reduce internet access costs through subsidies, public Wi-Fi initiatives, and infrastructure investments, making the internet more affordable and accessible to all segments of society. Additionally, implementing widespread digital literacy programs can empower people to use digital technology effectively. These programs should focus on teaching basic digital skills as well as more advanced capabilities, such as using AI tools.

For workers displaced by automation, providing retraining and education programs is crucial. These programs should be designed to equip workers with the skills needed for new job opportunities in a technology-driven economy. Successful initiatives can be seen in cities like Bangalore, India, known as an information technology hub and has made significant investments in digital infrastructure, with various digital literacy programs including free online courses and digital skills training for underserved groups. The city of Medellín in Colombia has also undergone a remarkable transformation thanks to investments in digital infrastructure and education, with an extensive network of digital libraries and digital literacy programs reaching various communities. With these measures, the digital divide can be narrowed, creating a more inclusive and connected society.

Reducing Dependence on Foreign Technology

To address the risks associated with dependence on foreign technology, developing countries must build local capacity, diversify technology providers, and adapt technology to local needs. Investing in local technology development and encouraging innovation can reduce dependence on foreign technology. This includes supporting local tech startups and fostering partnerships between local and foreign companies. Additionally, rather than relying on a single foreign vendor, developing countries should strive to diversify their technology sources. This approach reduces the risk of exploitation and ensures they do not become overly dependent on a single provider. Ensuring that foreign technology is adapted to meet local needs is also important. This can be achieved by working with technology providers to customize solutions that fit the specific context and needs of the local community.

Examples of success can be seen in Brazil, which has invested in developing its agricultural technology, particularly in biotechnology and genetic engineering. They have successfully developed pest-resistant and disease-resistant crop varieties, reducing dependence on imported seeds. Additionally, Brazil has a growing software industry, with several Brazilian tech companies becoming global players. In Indonesia, the “Making Indonesia 4.0” program was launched to promote digital transformation and enhance the competitiveness of the manufacturing industry, focusing on developing Industry 4.0 technologies such as the Internet of Things (IoT), artificial intelligence, and robotics. Furthermore, the “National Movement for 1000 Digital Startups” initiative was launched to promote the growth of local tech startups. With these steps, developing countries can reduce their dependence on foreign technology and build strong local capacity.

Addressing Unforeseen Social and Economic Impacts

To mitigate the social and economic impacts of smart city technology, the following strategies should be implemented. First, governments must develop inclusive policies that ensure the benefits of smart city technology are distributed equitably across all segments of society. This includes investing in infrastructure and services that serve marginalized communities. Second, encouraging public participation in the planning and implementation of smart city projects is crucial. Involving the community can ensure that the technology meets the needs and concerns of all residents.

In this regard, gamification can be an effective tool to increase public participation. By implementing game elements such as points, challenges, and rewards, citizens can be more motivated to participate in discussions and decision-making related to smart city projects. Gamification can make the participation process more engaging and interactive, increasing community involvement.

Third, regular monitoring and evaluation of smart city projects are essential to identify and address negative social or economic impacts. Feedback mechanisms should be established to enable continuous improvement and adaptation of strategies. Gamification can also be applied here by rewarding citizens who actively provide feedback or participate in evaluation surveys. Thus, the gamification strategy not only increases public participation but also ensures that community input is effectively used to refine smart city projects, creating a more inclusive and responsive environment for all residents.


Mitigating digital risks in smart cities is essential to ensure that these projects achieve their desired benefits without causing harm. By enhancing cybersecurity measures, strengthening data privacy regulations, bridging the digital divide, reducing dependence on foreign technology, and addressing unforeseen social and economic impacts, developing countries can create safe, inclusive, and sustainable smart cities. As progress continues, regional leaders and central governments need to adopt a proactive and well-planned approach to digital risk management. This way, they can harness the potential of smart city technology to improve the quality of life for their citizens while protecting against potential risks.

*Raine Renaldi, President ID-Opentech Group, Chairman Indonesia Smart City Provider Alliance.

Tuhu Nugraha
Tuhu Nugraha
Digital Business & Metaverse Expert Principal of Indonesia Applied Economy & Regulatory Network (IADERN)