Temu unlikely to give up Indonesia ambitions despite frosty reception

Chinese e-commerce platform expected to address fears about harming local businesses

- Hariz Baharudin

JAKARTA - Despite its strong performance in other parts of the region, Chinese e-commerce platform Temu has been struggling to gain a foothold in Indonesia, South-east Asia's biggest economy.

Several Indonesian officials said last week that Temu would "not be given a chance" to operate in the country, citing concerns over potential harm to local businesses.

Despite the frosty reception, Temu is unlikely to give up its quest to break into the Indonesian market, given the vast potential of the archipelago.

Analysts told The Straits Times that they expect Temu to work out a way to address Indonesia's concerns about protecting its home-grown businesses, similar to how TikTok managed to start operating its e-commerce arm there in 2023.

While the Temu app is available for downloads on smartphones in Indonesia, the app is not operational.

Since applying for a licence to operate in the country in 2022, Temu has been rejected three times. Officials have not shown any support for the platform so far. Minister of Communications and Informatics Budi Arie Setiadi said on Oct 1 that Temu could hurt Indonesia's economy and society.

"We will not give it the opportunity. The public will lose out, and we want the digital space to make the public productive and more profitable," he said.

Both the Ministry of Trade and the Ministry of Cooperatives and Small and Medium-Sized Enterprises (SMEs) have made similar remarks in recent months. The latter announced on Oct 7 that the Temu app will be taken down from Apple's App Store and Google's Play Store. However, as at Oct 9, the app remained available.

Temu has not made any public statement specifically addressing Indonesia's rejection of its applications for a licence. It has also not responded to requests for comment from The Straits Times.