- TikTok is stopping its online purchasing operation in Indonesia.
- There are 125 million TikTok users in the more than 278-million-person nation.
- there are approximately 64 million smaller companies, which make up about two-thirds of Indonesia’s economy.
Due to new regulations intended to safeguard regional physical and online merchants, TikTok is stopping its online purchasing operation in Indonesia. The change will go into effect at 10:00 GMT/17:00 Jakarta time.
One of the main markets for TikTok Shop was Indonesia, which was the first nation to test the app’s e-commerce functionality in 2021. E-commerce cannot transform into social media, according to Indonesia’s trade minister Zulkifli Hasan, who also stated that social media companies had one week to comply with the rules or risk losing their authorization to operate in the nation.
TikTok
The action was taken in response to Indonesian President Joko Widodo’s warning that e-commerce must be handled carefully. Since its debut two years ago, TikTok has increased its market share in Indonesia’s online retail industry, which is controlled by Tokopedia, Shopee, and Lazada.
There are 125 million TikTok users in the more than 278-million-person nation, including 6 million vendors and millions more producers who make money by promoting products on TikTok Shop.
Owners of physical stores, like Sukmamalingga, who has operated a shop selling Muslim clothes like kaftans in Tanah Abang Market in Jakarta for nine years, have been significantly impacted by the expansion of online retailers.
According to government statistics, there are approximately 64 million smaller companies, also referred to as micro, small, and medium-sized enterprises, which make up about two-thirds of Indonesia’s economy.
For TikTok, which has faced criticism in the US, the EU, and the UK, where Parliament has blocked the app from its network due to security concerns, the new laws are yet another blow.
