Indonesian trade Minister Zulkifli Hasan made set a new regulation on Wednesday to ban e-commerce transactions on all social media platforms, marking the move for the first Indonesia e-commerce ban on all social media.
In order to protect Southeast Asia’s biggest economy, the regulation is set towards offline merchants and marketplaces. The online market’s prices are extremely threatening to small and medium businesses.
According to reporters, trade Minister Mr. Hasan stated that the regulation is set to create a “fair and just business competition.”
Earlier this month Deputy Trade Minister Jerry Sambuaga stated that “social media and social commerce cannot be combined.”
He continues to state that the people should be able to differentiate between social media and social commerce or else he would vow to ban the overlap that is taking place. Deputy Trade Minister Jerry Sambuaga went ahead and focused on the one and only app TikTok. He stated that TikTok’s “live” is an example of how goods are being sold on social media.
The government adds that predatory pricing on social media platforms is endangering small and medium-sized businesses and that the action is intended to protect offline retailers and marketplaces in Southeast Asia’s largest economy.
A spokesperson of TikTok in Indonesia gave no response to the statements from both the Indonesian Trade Minister and Deputy Trade Minister. Five days later, the TikTok Indonesian spokesperson said that the government should reconsider their decision and not exclude “the livelihood of more than six million,” that are local TikTok active sellers.
TikTok in Indonesia has announced that the app has 325 million users registered in Southeast Asia that are active on a monthly basis. Out of the 325 million Southeast Asian users ,125 million are Indonesian.
It is known that TikTok is owned by ByteDance which is a Chinese company. Does Indonesia’s e-commerce ban have to do with the fact that TikTok is owned by a Chinese company.
The real question is ‘will Indonesia’s banning of online stores eventually become the norm?’
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