Interconnection-networking (Internet) is a global system of computer networks that connect with each other in all corners of the world using the Internet Protocol Suite (ISP) standard. Since first entering Indonesia in 1988, the internet has undergone many developments ranging from network quality to its functions and uses. Currently, Indonesian people not only use the internet to find information and communicate, but also for economic activities. One of them is buying and selling transactions, activities that were initially carried out by meeting directly between sellers and buyers, can now be carried out using internet-based electronic devices or what is called E-Commerce.

The rapid growth of internet users has made the internet an effective medium for companies and individuals to introduce and sell goods or services to consumers from all over the world without having to meet face-to-face. The rapid development of an electronic-based economy certainly has high economic potential for Indonesia. More and more sectors have been explored, ranging from Fast Moving Consumer Goods (FMCG) such as food, beverages and medicines, motor vehicle products, property to travel services. Based on BPS data, the total value of revenue in the e-commerce sector in Indonesia has quadrupled in the 4 years since 2017 from USD 8.46 billion to USD 30.31 billion in 2020. It is predicted that this value will continue to increase to reach USD 56.36 billion by 2025.

Based on data from the Ministry of Trade (Kemendag) the growth rate of Indonesia’s Digital Economy (EDI), including E-Commerce, reaches 8 times per year. Meanwhile, national economic growth as seen from the value of GDP only grew 1.5 times per year. Unfortunately, this rapid growth only contributes a relatively small amount to the national economy. The value of EDI only contributes about 4% to the national economy in 2020. It is predicted that in 2030 its contribution will reach 18% to the national economy or worth IDR 4,531 trillion.

 

Meanwhile, in terms of potential, based on data from the Ministry of Trade, by 2020 Indonesia has more than 200 million active consumers, 340 million mobile phone numbers, 160 million social media accounts, 18 million credit card holders, 37 million people trade and/or work in businesses. trade, 20 thousands of exporters and 15 thousands of importers. This shows that Indonesia has great potential in this sector. However, in 2020 the number of active e-commerce users in Indonesia has only reached 138.09 million people.

This small contribution certainly cannot be separated from the various challenges and obstacles faced by this sector. Inadequate digital infrastructure, regulations to protect both consumers and business players are unclear and overlapping and resources are still limited. This prompted the government to regulate regulations governing the electronic-based economy by issuing the Economic XIV Policy Package on E-Commerce. This is done to encourage the expansion and improvement of community economic activities throughout Indonesia in an efficient and connected manner, as well as to encourage the creation, innovation, and invention of new economic activities among the younger generation.

Several policy packages issued by the government include:

  • In 2017, Presidential Decree No. 74 of 2017 concerning the National Electronic-Based Trading System Roadmap or SPNBE. With this Presidential Regulation, the government considers the need for the availability of E-commerce data that can map the development of E-Commerce in Indonesia, as evidence-based policy making in policy formulation and decision making.
  • Government Regulation Number 80 of 2019 concerning Trading Through Electronic Systems (PMSE) which regulates parties who carry out, requirements, implementation, obligations of business players, climate, offers, receipts, confirmations, contracts, payments, delivery of goods, exchange of goods in trading with electronic systems, personal data protection, PMSE dispute resolution to PMSE supervision and guidance.

In the future, the government will also issue various policy packages that are expected to increase the growth and contribution of the e-commerce sector to the Indonesian economy. In addition, these various regulations also aim to increase the use and trade of domestic products, increase business opportunities, increase employment opportunities, increase the competitiveness of national products and businesses and increase protection for consumers and national business players.