Jokowi tells Indonesians to shop online to help revive growth


Indonesia may be hoping to replicate the success of online shopping campaigns elsewhere, like Cyber Monday in the US or Singles’ Day in China, started by major retailers before morphing into nationwide consumption free-for-alls. — AFP Relaxnews

Indonesia has tried all kinds of tricks in the book to revive sluggish consumer spending, from tax-free cars to cashbacks, to little result. Now it’s turning up the hype on online shopping.

More than 70 e-commerce platforms, including giants PT Tokopedia, Lazada Group SA and Shopee, are taking part in the “national shopping week” launched Wednesday with President Joko Widodo coming onto a televised programme to promote it, while local celebrities sang a jingle to get people to buy products from batik fabrics to “semprong” biscuits.

“If you want to send gifts for distant families and friends, just order and send them online so that our relatives can have it wherever they are,” the president said, wearing his iconic green bomber, a popular item on e-commerce platforms often listed as “Jokowi’s jacket”.

Indonesia may be hoping to replicate the success of online shopping campaigns elsewhere, like Cyber Monday in the US or Singles’ Day in China, started by major retailers before morphing into nationwide consumption free-for-alls. Economists and investors watch those online binges closely for clues on consumer health and companies’ bottom lines.

Consumer spending, which accounts for more than half of Indonesia’s gross domestic product, remains weak despite the vaccine rollout and Covid-19 cases stabilising. First-quarter GDP shrank by more than expected as virus restrictions keep people at home and limit the operations of shopping malls, cafes and restaurants. The government has lowered its growth forecast for the year to 4.5%-5.3%.

Busiest week

Jokowi expects the festival, which will run until May 13, to encourage Indonesians to still buy food, clothes and presents during one of the nation’s busiest shopping weeks ahead of Eid al-Fitr celebration, despite restrictions on travel and gatherings. Many of them may order in ahead of Eid in mid-May, especially as they receive an extra month’s pay for the holiday.

The Indonesian E-commerce Association, which represents companies including Lazada, Shopee, Tokopedia, Blibli and Bukalapak, said its members would shoulder free shipping during the festival. Lazada is also offering cashbacks, while Tokopedia has flash sale discounts of up to 90%.

The strategy makes sense for Indonesia, whose young and tech-savvy population pushed its Internet economy to grow over 10% to US$44bil (RM181.10bil) in 2020, the largest in South-East Asia. The trade ministry expects transactions during the shopping festival could top 11.5 trillion rupiah (RM3.31bil).

If last year was any indication, gross merchandise value should jump 30% during this Ramadan compared to the pre-holiday period, said Evelyin Wu, general manager at Genie Indonesia, an online marketplace management platform with over 39,000 active merchants. Genie estimates 150 million Indonesians have an e-commerce app on their mobile phones.

“Without going home, we can still stay in touch. And this is also our way of participating in driving the national economy,” Jokowi said on the TV programme. – Bloomberg

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