Indonesia's structural gaps impede its digital economy

Significance

About 150 million people (55% of the population) are already online, and three-quarters of them access the internet via smart feature phones or smartphones. Some pandemic-related shifts in consumer behaviour are probably permanent, promising opportunities to both domestic entrepreneurs and foreign investors. However, opportunities for the local workforce in the digital economy are limited by several structural constraints.

Impacts

• Low-skilled logistics and delivery jobs in e-commerce will be poorly paid and precarious.
• Indonesian start-ups face major shortages in hiring high-skilled local talent.
• Foreign investment into Indonesia’s digital ecosystem will rise.