Foreign Ministry calls for Indonesian startups to go international

A unicorn, in a business sense, is not a sparkly, rainbow-striped mythical creature. It is any privately held start-up valued at over US$1bil.

Jakarta (Nov 25, ANN): The Indonesia Foreign Ministry is now playing business matchmaker to connect Indonesian startups and venture capitalists.

Deputy Minister Mahendra Siregar has underlined the importance of empowering the startup ecosystem in the country to compete internationally and become the backbone of Indonesia’s economy.

The Foreign Ministry hosted the first-ever startup forum on Monday (Nov 25). It seeks to build Indonesia’s digital economy by helping startups engage with international communities. It wants to give them access to international markets and funding.

A number of government agencies have made efforts to nurture the country’s digital economy. The best-known initiative is the Communication and Information Ministry’s 1,000 Digital Startups Movement. Similar programmes are being conducted by the Industry Ministry and the Research and Technology Ministry.

Mahendra said on Monday (Nov 25) that a well-established, solid and competitive digital ecosystem at home was necessary to push Indonesia’s economy forward. He said such an agenda was in line with the ministry’s plan to improve economic diplomacy.

“A country with a huge market like Indonesia should have better adaptability. We cannot be a protectionist player as it can increase inefficiency, ” Mahendra told hundreds of startup players, government officials and venture capitalists at the Foreign Ministry's seminar, called Kemlu for Startup, in Jakarta.

At the same event, Research and Technology Minister Bambang Brodjonegoro said innovation and well-versed entrepreneurs were the keys to Indonesia’s goal to be a developed country by 2045.

“We cannot do that by conducting business as usual, ” Bambang said.

Indonesia, according to Mahendra, has many competitive advantages, including its large youth population with a dynamic and creative mindset.

In 2018, Statistics Indonesia found that 63.8 million – or a quarter of Indonesia’s population – are from 16 to 30 years old.

On the other hand, Mahendra said, many Indonesians still lack access to the domestic market, let alone engagement with the international economy.

He said communication between Indonesian businessmen, venture capitalists and government officials was important to determine what Indonesia has to offer to the international community.

A total of 367 startups attended the forum, of which 82 were chosen to have a "speed networking" session with seven local and international venture capitalists.

The Foreign Ministry, with its wide-ranging counterparts all over the world, can share its knowledge of the international situation with these startups and other government agencies to encourage local talent to go global, said the ministry’s director for Southeast Asian affairs, Denny Abdi.

According to a joint report by Google, Temasek and Bain, Indonesia was recognised as “the king of the digital economy" in the Southeast Asian market, contributing US$40bil to the total digital economy value of the region this year – which is expected to reach $100bil by the end of this year. The report predicted the sector would reach US$300 billion by 2025.

Indonesia and Vietnam recorded 40 percent of the growth in the digital economy sector since 2015. The report studied areas such as e-commerce, online media, ride-hailing services, e-travel and financial technology (fintech).

Among the participants on Monday was Rizki Suluh Adi, Indonesia country director for Element – a New York-based biometrics recognition startup. He said it was important to understand the relationship between the business ecosystem and the government as the regulator because sometimes their approaches were not coherent.

“Often, innovation is faster than regulation... When the market and the idea is ready, the regulations are unsupportive, ” said Rizki, whose startup is now working on the Southeast Asian market.

Indonesia has five unicorns, including ride-hailing service Gojek and ticketing service Traveloka, which has expanded its business into Vietnam, Thailand and the Philippines. - The Jakarta Post/ANN

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