Who benefits Indonesia’s gig economy? a more inclusive digital transformation is needed.

September 1, 2022

Bali, Indonesia - Indonesia is home to the multi-billion-dollar industry of the digital gig economy. But has the rapid growth of unicorns and digital startups in South-East Asia’s biggest economy by GDP provide answers to empower the most marginalized communities and accelerate green growth?

This issue was brought into prominence by UNDP Administrator Achim Steiner during his recent G20 trip to Bali where he met with some of Indonesia’s game-changers in digital economy 

 “In line with the call to ‘leave no one behind’, it is important to create more digital inclusive opportunities for the youth, people with disabilities, and women. Social protection, job security, and legal status certainty are, therefore, basic essentials for gig workers,” said Mr. Steiner, as he addressed a group digital CEOs, young entrepreneurs and social impact investors.

According to Google, Indonesia’s digital economy is expected to grow by a staggering USD 146 billion by 2025. The emergence of the digital economy also opens new income-generating opportunities in the so-called ‘gig economy’ where workers have more freedom on work hours and location.  Needless to say, the unregulated gig economy is not without its own challenges. Lack of digital inclusion, limited workers’ rights and lack of job security, are just some of those challenges.

Mr. Steiner continued, “The challenge between citizens, and governments, and the private sectors, is to come to a common understanding of what it means to build a digital ecosystem. The ecosystem has a lot to do with technology, with regulatory frameworks, but also with introducing an education or early curricula that allows school leavers to enter the new digital economy and possibility with a skillset that can operate within it.”

Responding to Mr. Steiner’s call, all of the key digital players highlighted the opportunities which digital economic can bring to the table.

The digital startups are very impactful, because the opportunity they can exploit is using digital to arbitrage and bring together the MSME and Gig economy workers, and empower them to challenge the established player,” said Donald Wihardja, CEO of MDI Ventures.

Wihadja’s MDI Ventures holds a total committed assets under management valued at USD 830 million per 2021.

Oher prominent participants, such as Dita Aisyah, Co-founder and CBO of Binar Academy, underlined the importance of facilitating access to technology education and developing digital proficiency among Indonesia's young talent. His point of view is shared by Lisa Widodo, COO of Blibli.com, who explored how the unicorn firm conducts sustainable business operations and utilizes marketplace technology to improve economic growth of individuals by offering equitable access to enter the market and directly contributes to the SDGs.

G20 identify digitalization as the most important point, The use of digital technology is a key factor, enabling factor to develop the MSME in the context of resilient recovery in this country and other country,” said. Norimasa Shimomura, Resident Representative of UNDP Indonesia during the event. He further steered the discussion on the rising phenomenon of digital economy in Indonesia, seeing the opportunities ahead.

Indeed, tapping into these opportunities is the key to fully benefit the digital economy. The emergence of digital economy provides an opportunity to reset the balance of socio and economic inequality in a country where digital connectivity remains a challenge in remote areas, along with critical access to health and education.

Therefore, as the government and other stakeholders advocate for more direct investment, capacity building, and research in the digital economy, a stronger commitment to inclusion and sustainability should be the strategic plan's cornerstone.


Written by:    

Muhammad Didi Hardiana, Head of Innovative Financing Lab

Randa Sandhita, Youth Engagement and Entrepreneurship Officer


Edited by:

Tomi Soetjipto and Ranjit Jose