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November 13, 2024 | 07:19 pm
TEMPO.CO, Jakarta - The latest report by Google, Temasek, and Bain & Company, projects that Indonesia's digital economy will reach a Gross Merchandise Value (GMV) of US$90 billion or around Rp1,414 trillion in 2024, a 13% increase from the previous year, making Indonesia as the country with the largest GMV in Southeast Asia.
According to the e-Conomy SEA 2024 report, the e-commerce sector is a major driver of this growth, with an estimated 11% increase in GMV to reach US$65 billion in 2024. Innovations by leading e-commerce platforms have significantly enhanced user experience, contributing to this surge.
Indonesia also stands out as the second-fastest-growing market for creator video uploads, with a Compound Annual Growth Rate (CAGR) of 16% between 2022 and 2024.
Veronica Utami, Country Director of Google Indonesia, mentioned the growing video commerce and the creator economy. “The rapidly growing video creator community in Indonesia underscores the significant potential of this sector,” she said in a written statement on Wednesday, November 13, 2024.
Veronica explained that artificial intelligence (AI) is emerging as a key driver of Indonesia's digital transformation. AI is being applied in various fields, including marketing, gaming, and education, to enhance user experiences through personalized interactions. To support AI services and data growth, data center capacity in Indonesia is set to increase by 268%, reaching 202 MW.
According to Veronica, AI implementation and collaboration with government and industry stakeholders are necessary to ensure digital security and build user trust. “We believe Indonesia has the potential to lead digital innovation in the region,” she added.
Other digital sectors are also experiencing positive growth. Online travel is projected to grow by 24% to US$9 billion GMV, fueled by a 400% increase in international travel since 2020. Digital financial services are expected to reach a Gross Transaction Value (GTV) of US$404 billion, with a 19% growth rate. Digital lending is projected to reach US$9 billion GMV, while food delivery and online media are estimated to reach US$6 billion and US$8 billion, respectively.
Aadarsh Baijal, Partner at Bain & Company, highlighted Indonesia's pivotal role in driving the largest digital economy growth in Southeast Asia. “We estimate that GMV will double by 2030, primarily driven by e-commerce and online travel, especially with the anticipated increase in intra-regional travel,” he said.
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