In major blow to TikTok, Indonesia bans e-commerce transactions on social media 

Indonesia has banned e-commerce transactions on social media platforms, the trade minister said on Wednesday (Sep 27), in a blow to short video app TikTok, which is doubling down on Southeast Asia's biggest economy to boost its e-commerce business. 

The government said the move, which takes effect immediately, is aimed at protecting offline merchants and marketplaces, adding that predatory pricing on social media platforms is threatening small and medium-sized enterprises. 

The move comes just three months after TikTok pledged to invest billions of dollars in Southeast Asia, mainly in Indonesia, over the next few years in a major push to build its e-commerce platform TikTok Shop. 

TikTok, owned by China's ByteDance, has 125 million active monthly users in Indonesia and has been looking to translate the large user base into a major e-commerce revenue source. 

A TikTok Indonesia spokesperson said it would pursue a constructive path forward and was "deeply concerned" with the announcement, "particularly how it would impact the livelihoods of the 6 million" local sellers active on TikTok Shop. 

Indonesia Trade Minister Zulkifli Hasan on Wednesday told reporters that the regulation is intended to ensure "fair and just" business competition, adding that it was also intended to ensure data protection of users. 

He warned of letting social media become an e-commerce platform, shop, and bank all at the same time. 

The new regulation also requires e-commerce platforms in Indonesia to set a minimum price of US$100 for certain items that are directly purchased from abroad, according to the regulation document reviewed by Reuters, and that all products offered should meet local standards. 

Zulkifli said TikTok had one week to comply with the regulation or face the threat of closure. Indonesia Deputy Trade Minister Jerry Sambuaga earlier this month named TikTok's live streaming features as an example of people selling goods on social media. 

Research firm BMI said TikTok would be the only business affected by the transaction ban and the move was unlikely to harm the digital marketplace industry's growth. 

Indonesia's e-commerce market is dominated by the likes of homegrown tech firm GoTo's Tokopedia, Sea's Shopee and Chinese e-commerce giant Alibaba's Lazada. 

E-commerce transactions in Indonesia amounted to nearly US$52 billion last year and of that, 5 per cent took place on TikTok, according to data from consultancy Momentum Works. 

Indonesia is among the few markets where TikTok has launched TikTok Shop, as it seeks to leverage its large user base in the country. 

Its 125 million active monthly users in Indonesia is almost on par with its user figures for Europe and behind US users of more than 150 million. TikTok launched an online shopping service in the United States earlier this month. 

Reactions from retailers were mixed. 

Fahmi Ridho, a vendor selling clothes on TikTok, said the platform was a way for stores to recover from the blow dealt by the COVID-19 pandemic. 

"Sales don't have to be necessarily through (brick and mortar) shops, you can do it online or wherever ... Everything will still have a portion," he said. 

But Edri, who goes by one name only and sells clothes at a major wholesale market in Jakarta, agreed with the regulation and stressed that there should be limits on items sold online. 

Source: Channel News Asia 

Indonesia launches carbon trading in bid to tame coal 

Indonesia launched its first carbon emissions trading market in an attempt to curb the climate impact of its coal-dominated power sector. 

An initial 13 transactions covering 459,914 tonnes of carbon dioxide equivalent (CO2e) from PT Pertamina Geothermal Energy’s projects in North Sulawesi were traded at Tuesday’s opening. Credits traded at a price of 69,600 rupiah per tonne, according to a trading board at the Indonesia Stock Exchange, which facilitates the trade. That is far below the cost of similar products in established emissions markets like the European Union. 

The buyers were some of Indonesia’s largest banks like Bank Central Asia and Bank Mandiri, other units of state energy firm Pertamina and companies in the mining sector, among others. 

President Joko Widodo said Indonesia has tremendous potential for carbon reduction efforts, particularly nature-based solutions, and its carbon market could grow to 3,000 trillion rupiah (S$266 billion). 

“I am very optimistic that Indonesia can become the world’s carbon (market) axis as long as concrete steps are taken consistently and jointly by all stakeholders,” Mr Joko said during the launch. 

In its initial stage, trading will be voluntary, but the government is working to put out a plan for further national regulations on pollution, which will include a carbon tax, Mr Luhut Pandjaitan, Coordinating Investment and Maritime Affairs Minister who oversees regulations for carbon pricing, said at the launch. 

Some of Indonesia’s biggest coal power plants have begun trading emission allowances since February. 

Initial trading is open to coal plants generating at least 100 megawatts of power and that are linked to state utility Perusahaan Listrik Negara’s grid, which accounts for about 86 per cent of the Indonesia’s coal capacity. 

The IDXCarbon exchange will aim to incentivise utilities to cut pollution by setting an emissions cap for the power plants and allowing them to trade any unused credits. The South-east Asian nation sees a potential economic gain of as much as 3,000 trillion rupiah from the sale of carbon credits, President Joko Widodo said at the launch event. 

Indonesia is aiming to zero out its emissions by 2060 by pivoting away from coal power and ramping up investments in cleaner energy. The nation could hit that target five years early with adequate funding, Mr Luhut said in June. 

“This is just the beginning, so we’re not expecting immediate big interest from the domestic market,” said Mr Paul Butarbutar, executive director at think tank Indonesia Centre for Renewable Energy Studies. “But it is hoped that as time goes by, and with better dissemination, the domestic carbon exchange will further grow.” 

Governments across Asia are putting prices on emissions, though the region’s carbon markets have so far fallen short of delivering any meaningful impact. Prices in South Korea and China are regarded as still below the level needed to compel large corporate emitters to cut pollution. BLOOMBERG, REUTERS 

Source: The Straits Times 

Government plans to start Bali LRT groundbreaking in early 2024 

Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan targeted the light rail transit (LRT) project in Bali to start its groundbreaking in early 2024. 

 
"We hope we can conduct the groundbreaking for Bali LRT in early 2024. The study had been carried out for a long time but was hampered due to the COVID-19 pandemic," he remarked after attending a limited meeting on Public Transportation Integration at the Merdeka Palace on Wednesday. 

 
Pandjaitan noted that the LRT will cross I Gusti Ngurah Rai Airport and support passengers' movement from and to the airport. With no LRT, an accumulation of passengers will occur in 2026, considering that the airport serves around 24 million passengers annually. 
 
The minister also stated that during the meeting, President Joko Widodo had ordered ministers to conduct further studies for the Bali LRT from the Ngurah Rai Airport to Seminyak or further to Canggu. 

 
"The plan is to open the LRT route from the airport to Seminyak and will continue to Canggu for possible, for around 20 kilometers. We are planning to charge a ticket price of around US$1 to US$2 for each airplane passenger, whether they use the LRT or not. Therefore, the public financing can support the LRT operation," he remarked. 
 

During the meeting, the minister stated that President Widodo had pressed for the integration of LRT, MRT, and other means of public transportation to accommodate people in using public transport. 
 

The head of state also pushed for accelerated development of public transportation connecting infrastructure with adequate facilities and infrastructure. 
 
"For example, connecting bridge for Halim LRT station and High-Speed Train station, a connecting bridge for Manggarai Train Station with TransJakarta bus stop, a connecting bridge for Tanah Abang and Dukuh Atas stations, and others. We must ensure that each facility has sufficient lighting and protecting people from rain," he stated. 

Source: Antara News