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Indonesia's digital economy keeps its verve, study shows
A report published by Google, Temasek and Bain & Company forecasts that Indonesia’s digital economy GMV will reach $77 billion this year and grow at 19 percent annually over the coming years.
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Icons for the apps of six Indonesian unicorns are shown on a smartphone screen on Aug. 3, 2021. (JP/Norman Harsono)
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ndonesia’s digital economy will reach a size of US$77 billion in gross merchandise value (GMV) this year and grow at double-digit rates over the coming years, a study has found.
The e-Conomy SEA report published on Tuesday by Google, Temasek and Bain & Company finds that the country’s digital economy has grown by 22 percent over the past year.
“After years of acceleration, the growth of digital technology has now turned into its normal pace, with tech-savvy urban haves and youth being the biggest digital service users,” said Google Indonesia managing director Randy Jusuf.
Indonesia’s digital economy market is to reach $130 billion in 2025 – growing at a compound annual growth rate (CAGR) of 19 percent – and between $220 billion and $360 billion in 2030, the report predicts.
Accounting for 77 percent of the GMV, e-commerce’s contribution of $59 billion shows just how strong the sector is, despite the comeback of offline shopping as the pandemic-related public activity restrictions have largely been lifted.
In 2025, it is projected to grow to $95 billion, which translates to a 17 percent CAGR.
“Indonesia has the fastest growth in the e-commerce sector [in Southeast Asia], second only to Vietnam. But, beside GMV, there are many growth dimensions it needs to focus on,” said Randy.
