US-ASEAN Business Council Launches e-Commerce Report at Jakarta Event

(Jakarta) – On April 13 the US-ASEAN Business Council marked the launch of its report, “Enabling Cross-Border e-Commerce Trade in ASEAN,” with an event in Jakarta co-hosted by MASTEL, the Indonesia ICT Society.

The timely report examines the potential for growth in the e-commerce sector in the Association of Southeast Asian Nations (ASEAN) due to increased connectivity and access to technology across the region, along with increased spending power. In her opening remarks, to an audience that included U.S. and Indonesian government and private sector representatives, US-ABC Chief Representative for Indonesia Desi Indrimayutri highlighted the prospect of a more unified and dynamic e-commerce ecosystem under the ASEAN Economic Community (AEC). “With the recent launch of the AEC and the intent to develop an ‘ASEAN Agreement on e-Commerce,’ we must seize the opportunity to prioritize regional policy coherence in support of cross-border e-commerce trade. The ASEAN e-commerce market has grown 15% in each of the last four years, and is projected to grow even faster in the near future. This is a tremendous opportunity for growth that will benefit businesses and consumers across the region, but it needs to be approached strategically and according to international best practices,” she said.  In a report issued by A.T. Kearney and Axiata Group Berhad on February 16, 2016, it noted that ASEAN’s Digital Economy could add up to US$1 trillion to ASEAN’s GDP over the next ten years if the region puts in place policies and a strong regional digital agenda with visionary government and industry collaboration.

In his opening remarks, Chairman of MASTEL Kristiono said, “Like any other country, Indonesia cannot exclude itself from the increasing use of IT-based applications, including those central to e-commerce. MASTEL is supporting the position of Ministry of Communication and Information Technology that Indonesia welcomes any apps and business models from all over the world as long as they comply with all regulations in Indonesia.” Christine Brown, Director for Southeast Asia for the Office of the U.S. Trade Representative, also offered remarks.
The report offers 12 targeted recommendations for the coordination of policies and regulations throughout the region, so that information, goods, and services can more easily flow between businesses and consumers. “Building on the vision of the ASEAN ICT Masterplan 2020, a harmonized regional approach to e-commerce regulation is the surest way to reap the full benefits of e-commerce,” said Shay Wester, US-ABC Director for ICT. “This includes connecting SMEs to global markets, enabling new startups, and providing consumers with a wide range of goods more efficiently and more cost effectively. Reducing barriers to the movement of goods and the secure transfer of data will enable quicker, more inclusive growth.” Approximately 12 percent of the global goods trade is conducted via international e-commerce and 86% of the world’s tech based startups are involved in some form of cross border e-commerce activities according to the Digital Globalization: The New Era of Global Flows study issued by the McKinsey Global Institute in March 2016. Representatives from U.S. companies UPS, Google, Cisco, and Facebook presented the specific policy measures outlined in the report.
 
A panel discussion comprised of Indonesian officials and private sector representatives discussed country-specific benefits and challenges. While the report identifies Indonesia as having the highest number of online shoppers in ASEAN, more can be done to facilitate the sector’s growth. Participants in the panel included representatives from the Ministry of Communications and Information Technology, Ministry of Finance, Ministry of Trade, Bank Indonesia, the Association of Indonesian Internet Providers, and the Indonesian E-Commerce Association.
 
The full report, “Enabling Cross-Border e-Commerce Trade in ASEAN,” is available here.