Please be anxious about the Creative Industry Ecosystem and the Digital Economy after the Announcement of the Advanced Indonesia Cabinet

Yesterday (23/10) President Joko Widodo selected and announced a list of ministers and officials for his new cabinet. Although during the campaign period the jargon of "digital economy" was conveyed, the list of ministries announced was quite surprising for actors in the startup ecosystem, as one of the spearheads of the national digital economy.

There are two things that are quite disturbing, firstly, the merging of Bekraf into the Ministry of Tourism, became Kemenparekraf. Melting is a term not to call it annihilation. Although it is led by a figure who is predicted to be young and creative, this indicates a lower priority for the development of the creative industry, including digital startups. How not, so far the role of Bekraf is quite significant for industry players.

The programs specifically target the needs of creative people, as can be seen from the composition of the existing deputies, including research, capital, infrastructure, marketing, intellectual property rights, and inter-institutional relations. While ideally with the existing potential, tourism is indeed a separate focus.

The creative economy cannot be underestimated

According to the results of research conducted by BPS and Bekraf in 2016, the creative economy sector contributed to 7,35% of the national GDP, contributing a value of more than 922 trillion rupiah. Continually, this number is moving up until it is projected to grow 4,13% by the end of this year. The creative economy has supported nearly 17 million workers, from various fields including digital startups.

Referring to other sources, for example the results of research by Google, Temasek, and Bain & Company entitled "e-Conomy SEA 2019", this year Indonesia's digital economy has reached $40 billion and is predicted to increase sharply to $133 billion in 2025 future. Sector e-commerce, ride-hailing, travel, and the media are the main drivers. With this number, Indonesia is at the forefront of Southeast Asia.

Unfortunate things

Besides Bekraf, the protector of the national digital industry is the Ministry of Communication and Information. So far, Rudiantara has been quite active in advocating for startups, with the ambitious target of giving birth unicorn new. To support this step, various efforts are needed, including accommodation with appropriate policies. Now Johnny Gerald Plate has been elected as Mekominfo. The name is relatively new to most creative and digital industry players – maybe not in politics. This is a point second.

Agile steps are needed to protect the creative and digital ecosystem which is currently growing very fast. The disruption that is presented is very real in changing new ways in society. Ecosystem is no longer in age "early stage", instead have entered "scale-up", so that a relevant track record is needed from the policy makers who oversee it. During the minister's announcement yesterday, Johnny was asked by the president to take care of matters related to cyber security, data sovereignty, and the domestic ICT industry. A very heavy and serious task.

Last Monday (22/10), Nadiem Makarim's presence at the palace was enough to provide a breath of fresh air for the industry. Many expect the formation of a new ministry that specifically oversees the creative and digital economy. In fact, he was positioned at the Ministry of Education. Indeed, HR is a crucial issue that must be revolutionized with a more impactful approach. However, Nadiem's ​​track record for dealing with disruptive business alignment is a pity not to be optimized.

It's hard not to be pessimistic

Digital startups have given birth sector fintech, they are able to facilitate various groups who were previously untouched by banking services on financial products, with technology connectivity. Digital startups have spawned a sector ride hailing and online marketplace, opening up thousands of business opportunities while transforming SMEs through the internet. Not to mention talking about the sector new retail, healthtech, edutech, and others that are starting to have a significant impact on Indonesia.

It's hard to give an announcement, even though I know that there are political calculations that the President has to consider. Hopefully this is not a process to sacrifice the creative and digital industries for interests that are considered bigger.