The Indonesian government is considering banning TikTok sales as the country's government is set to discuss e-commerce within the region.
The situation comes as many people and businesses have taken to social media platforms to market their products or services. These include the Tanah Abang Market in Jakarta, which belongs to entrepreneur Andre Oktavianus.
Indonesia Considers Ban on TikTok Sales
The businessman said that promoting children's clothes online instead of to people who pass by his stall was one of the best decisions he made for his business. The 37-year-old said that his sales increased after deciding to start selling on online platforms via live stream in 2017, which came nearly a decade after he began his business.
Oktavianus added that TikTok Shop, in particular, has helped him grow his business bigger than ever. He noted that with the social media platform, he has seen a turnaround increase of 30% to 40%. It referred to the platform's shopping arm, which launched in Jakarta roughly two years ago, as per the Straits Times.
However, those good times may soon end, and entrepreneurs such as Oktavianus, who uses social media to generate sales, may not be able to do so for much longer. In recent weeks, several government officials have called for social media and e-commerce to be separate, a remark aimed at companies such as TikTok and Shopee.
They argued that unfair social commerce practices threaten local and small businesses. Social commerce is a subset of e-commerce that involves social media and has consumers interacting with sellers while buying and selling products and services.
The situation comes at a time when live shopping, a form of social commerce, is on the rise within the region and has helped many businesses make huge profits in a shorter amount of time than before.
Social Media E-Commerce
Indonesia's Ministry of Trade plans to officially release revised regulations regarding e-commerce within the region as early as this week. This could ultimately determine the fate of TikTok Shop and how people and businesses take advantage of it within the country, according to Tech in Asia.
The ministry's director general of domestic trade, Isy Karim, said the updated rules will be finalized before submission to the law ministry. The decision comes after many regulators in Indonesia expressed concerns that TikTok Shop was monopolizing the market.
One of the most contentious points covered by the updated rules is whether or not e-commerce transactions should be prohibited on social media platforms. The Indonesian government is also considering ordering a ban on selling imported goods priced below $100 through cross-border services on e-commerce platforms.
In a streamed video address on Monday, Indonesian President Joko Widodo, known as Jokowi, said that the people had just decided to use social media for e-commerce. He added that the expectation was that technological advancement would help create new economic potential, not kill existing economies, said Reuters.
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