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Tech industry to lead growth in Indonesia until 2022

The ICT sector has benefited from the increased digitalization of people’s daily activities, such as work and school, during the pandemic.

Dzulfiqar Fathur Rahman (The Jakarta Post)
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Tue, June 8, 2021 Published on Jun. 7, 2021 Published on 2021-06-07T19:59:55+07:00

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T

he information and communications technology (ICT) sector is expected to lead economic growth in Indonesia both this year and in 2022, as the COVID-19 pandemic has induced a faster-than-expected takeup of digital services.

The ICT sector will grow by between 9.1 and 10.1 percent this year and 9.8 to 10.3 percent in 2022, according to a Fiscal Policy Agency (BKF) projection.

“Other sectors look even, but the sector we have generally been focusing on, namely information and communications, is performing really well,” BKF head Febrio Kacaribu said at an online briefing on Friday. “We also see it continuing to improve in 2022.”

While the pandemic has battered contact-intensive industries, the ICT sector has benefited from the increased digitalization of people’s daily activities, such as work and school, as the government has upheld mobility restrictions in one form or another for more than a year.

The ICT sector, which employs less than 1 percent of the national labor force, grew by 10.6 percent in 2020, second only to healthcare services. Conversely, the transportation and warehousing sector, which employs some 4.5 percent of the workforce, booked the sharpest contraction at 15 percent, followed by food, beverages and accommodation services.

The gross merchandise value (GMV) of the country’s internet economy was estimated to grow by 11 percent to US$44 billion in 2020 from a year earlier, according to the e-Conomy SEA report by Google, Temasek and Bain & Company.

Read also: Indonesia to see double-digit growth in digital transactions this year: BI 

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