MUHAMMADIYAH.OR.ID, BANDUNG – Vice Chair of the Muhammadiyah Council for Library and Information Services Ismail Fahmi mentioned the significance of the digital economy in the modern landscape.
Ismail Fahmi shed light on the pivotal role of the digital economy in the contemporary world. The digital economy represents a form of economic activity profoundly reliant on advanced digital technologies to facilitate the production, distribution, and consumption of goods and services. This technological purview spans the internet, artificial intelligence (AI), big data, and blockchain.
In essence, the digital economy has supplanted conventional methods with cutting-edge technologies. “Today, even my spouse no longer goes to traditional markets for her shopping needs. A smartphone has transformed the entire shopping experience, emblematic of our engagement with the digital economy,” said Ismail Fahmi.
Ismail Fahmi also delineated the digital economy as an essential component within every facet of the economic spectrum. It extends across multifarious sectors, including e-commerce, digital banking, instant messaging applications, and social media. The profound impact of the digital economy encompasses augmented productivity, enhanced efficiency, and an atmosphere conducive to innovation.
Additionally, Ismail Fahmi delved into Indonesia’s concerted endeavors to position the nation as a regional epicenter for the digital economy. These efforts materialize through the formulation of an e-commerce roadmap. Nevertheless, Indonesia faces multifaceted challenges within the e-commerce ecosystem.
One of the primary concerns is the stark reality that most products transacted within the Indonesian digital economy are of foreign origin. A staggering 74% of e-commerce merchants are not proprietors of the merchandise they market. Furthermore, imported items are frequently vended beneath their cost price, thereby invoking the imposition of safeguard taxes. Ismail Fahmi recognizes the dominance of foreign platform giants within this burgeoning sector.
“Indonesia’s digital commerce landscape reveals a disconcerting reality that approximately 90% of goods bought and sold are imported. Indeed, a substantial 74% of e-commerce traders are intermediaries without ownership of the products they peddle. These imported wares are often sold below cost, precipitating safeguard tax impositions. Indonesia, indeed a democracy, is now urged to offer precedence to indigenous products over foreign imports,” said Ismail Fahmi.
Drawing inspiration from China’s deliberate approach, Ismail Fahmi mentioned how the Asian powerhouse has adopted stringent measures to regulate foreign investment inflows into the digital economy sector. China’s strategy prioritizes nurturing domestic digital platforms by imposing restrictions on foreign investments and providing a favorable environment for the growth of local enterprises. Noteworthy within this context are the resolute measures China has enforced, such as the imposing “Great Firewall,” and the implementation of the “Cybersecurity Law.”
“China enacts stringent controls on foreign investments, thereby fostering the evolution of domestic platforms. China stands as a vivid exemplar, where e-commerce is chiefly the dominion of Alibaba and JD.Com, search engine supremacy lies with Baidu while Google is notably absent, and the realm of messaging applications is ruled by Tencent and WeChat,” said Ismail Fahmi.
With various possibilities and complexities within the digital economy, Ismail Fahmi resounded the importance of adopting strategic measures and judicious policies. This approach is vital to propelling Indonesia towards sustainable growth within the digital economy sector, operating within an increasingly competitive global milieu.
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