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RI promotes digital technology as tool to reduce inequality
Indonesia is launching a mission to convince the world that digital technology can become an effective measure to reduce income inequality, and not a harm to employment in industry
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I
ndonesia is launching a mission to convince the world that digital technology can become an effective measure to reduce income inequality, and not a harm to employment in industry.
Through the global event ITU Telecom World 2017 in Busan, South Korea from Sept. 25 to 28, Indonesia showcased the success stories of local e-commerce startups that have succeeded in boosting the economy and slashing costs.
Representatives from Indonesian startups participating in the event include online marketplace Tokopedia, peer-to-peer lending platform Modalku, financial technology (fintech) firm Cashlez and online groceries app TukangSayur.co.
“Our aim [for joining this ITU event] is to show the world that countries can maximize digital technology to reduce the income gap between the haves and the have-nots,” Communications and Information Minister Rudiantara told reporters on the sidelines of the event on Monday.
Tokopedia, for example, has 2 million merchants nationwide, 80 percent of whom had zero background in entrepreneurship. These merchants sold 60 million products directly to customers, bypassing middlemen and overcoming logistical issues typically faced by conventional businesses.
Rudiantara believes the emergence of such businesses could help to open up job opportunities, which will then reduce the Gini ratio — the inequality rate which marks 0 as perfect equality and 1 as complete inequality.
According to a research finding published by Oxfam, 1 percent of the world’s population as of 2016 would own more wealth than the majority 99 percent. The research, which was updated last January, found that the eight richest men own as much wealth as the poorest half of the world’s population.
“We want to show less developed countries that they can use digital technology to reduce the Gini ratio. At the same time, we want to send a message that developed countries can’t walk alone,” Rudiantara said.
Indonesia also viewed that micro, small and medium enterprises with digital economy business potential in the under-served regions have to be supported through better infrastructures.
In this case, the Indonesian government has undertaken affirmative action to utilize universal service obligation (USO) fund from telecommunication companies to provide digital access and connectivity through the Palapa Ring project. The project aims to provide a nationwide fiber optic backbone in all 514 municipal counties.
Despite some of the successful stories, the government admitted the need for technology transfer from other countries, such as South Korea, to develop fixed broadband and provide internet access at home via phone line or the provider’s network of cables.
“We have met with KT Corporation [South Korea’s largest telephone company]. We want to learn from their experience in fixed broadband,” the Communications and Information Ministry’s broadband development director Benyamin Sura, said.
He further explained that fixed broadband was important as the technology provided stable and high quality connection for TV, radio and internet services. “The government’s role is to ensure that fixed broadband can reach all districts,” he said.
In order to accelerate the development of tech startups in Indonesia, the government is keen to attract venture capital investment from abroad.
