Small and medium enterprises are tipped to fuel 13 percent growth in Indonesia's information, telecommunication and communication spending this year, a research firm International Data Corporation (IDC) said. (JG Photo/ Syarifah Ryaclaudia)

SMEs Fuel Growth in 2016 IT Spending

BY :EMANUEL KURE

JULY 29, 2016

Jakarta. Small and medium enterprises are tipped to fuel 13 percent growth in Indonesia's information, telecommunication and communication spending this year, a research firm International Data Corporation (IDC) said.

The small and medium business sets to spend $1.5 billion for IT hardware, software and services, accounting for 10 percent of total ICT spending that is estimated to reach $ 14.7 billion. Last year total IT spending was $13 billion, according to IDC data.

"The majority of SME's purchases is for basic requirements like mobile phone, fixed line and broadband services and hardware like printers and computers," Reza Haryo, senior market analyst at IDC Indonesia, said on Thursday (28/07).

Central Statistics Agency (BPS) data showed there are currently 57.6 million SMEs operating in Indonesia, contributing nearly 60 percent of gross domestic product .

IDC estimated that only 10 percent of SME that have adopted digital technology in running the business, Reza said.

"Our SMEs are still in their infancy in terms of implementing IT in their operation,s so the market opportunity ahead is still very large," Reza said.

More of the country's SMEs would soon tap into mobile platforms as a way to boost productivity and reduce costs, Reza said.

The government is targeting to establish 1,000 local digital entrepreneurs by 2020, in order to create $130 billion additional value from the digital economy.

A major initiative of the program is to create and accelerate the application of digital technology among SMEs in Indonesia, and also look at ways appropriate to facilitate and encourage a digital platform to drive change in business model and operations.

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