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New e-commerce rules planned to limit access to foreign goods
The government is mulling over regulations directed in part at keeping some foreign products off domestic platforms.
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Employees work at a warehouse belonging to e-commerce giant JD.ID in Marunda, Bekasi, West Java, in December 2021. (Antara/Muhammad Adimaja)
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ew rules for e-commerce platforms are meant to keep some foreign products out of the domestic market in what the government calls an effort to create a level playing field.
Trade Minister Muhammad Lutfi and Cooperatives and Small and Medium Enterprises (SMEs) Minister Teten Masduki said on Monday that the planned rules aimed to protect local micro, small and medium enterprises (MSMEs) from the “onslaught of foreign products” offered by foreign e-commerce firms.
“It won’t be easy [to implement] such a regulation. The government will be careful not to violate free trade provisions. But the Indonesian market is very large, many foreign products are not made yet in Indonesia,” Teten said at a media gathering in Jakarta, as reported by Kontan.
At a G20 Trade and Investment Ministerial Meeting (TIMM) in Sorrento, Italy, last year, the trade minister voiced his concerns about the absence of adequate international rules to regulate digital competition among MSMEs, saying this would create “victors” that might kill off small businesses and industries in emerging economies.
Critics have demanded rules to prevent predatory pricing in e-commerce, arguing that the dumping of imported goods at uneconomically low prices could shut out local MSMEs.
Read also: International trade might ‘kill’ local MSMEs, minister warns G20 meeting
Teten went on to say that the government planned to limit the range of foreign goods sold by foreign e-commerce firms operating in Indonesia, for instance by ensuring that foreign products sold on such platforms would need to cost no less than US$100 per product.
