Sunday, January 29, 2023

Indonesia’s G20 Presidency: Advantages from Within

Emilia Yustiningrum

For the first time, Indonesia holds the G20 Presidency from December 2021 up to November 2022. By soaring the theme of “Recover Together, Recover Stronger”, Indonesia delivers five priorities on increasing resilience and stability, promoting productivity, ensuring sustainable and inclusive growth, enabling environment and multi stakeholder partnerships, and forging a stronger collective global leadership.

Since its inception in 1999, the G20 is a platform to coordinate the national policies among the member states to resolve the economic crisis. With the existence of the G20, the global economic policy is not only being directed by the G8 or IMF. Each member of G20 has possibility to have a rotation of chair. It provides small states and emerging economies to host the meetings and deliver their voices within the regional institution.

The G20 summit in Rome in October 2021 has mandate to transfer presidency from Italy to Indonesia. Within a year, Indonesia will host 150 various meetings from the head of governments, finance ministers and central bank governors, to the business communities, civil societies, scientists, think tanks, labour unions, women, urban cities, and the youths. With such diverse participants and expanding issues covering finance and non-finance matters, what advantages that Indonesia have and do as the G20 presidency?

On the Rome summit, Indonesia focused on main issues on covid-19 vaccine distribution, global health recovery through digital economy, and the engagement of women on the Micro, Small and Medium Enterprises (MSMEs).

In 14 November 2021, Indonesia has reached 208,265,720 vaccine distribution nationwide (KPCPEN, 2021). It meant Indonesia has reached the first global sixth country to vaccinate its citizens based on the number of shots.

Covid-19 has hit the global economy since the beginning of 2020. By having the opportunity to lead the G20 presidency, Indonesia encouraged the G20 Empower – that first being introduced during Osaka summit in 2019 – to grow commitment to distribute vaccine evenly especially to the non-producing countries. The efforts would be done by mobilizing global fund to recover from pandemics.

Indonesia has brought the ideas of equality and fairness to vaccine distribution to both the developed and developing countries. It has strengthened the goals of the G20 as an economic forum that recovering from global health crisis could not be done by unilateral action but involving comprehensive and continued multilateral cooperation. The more countries involved on the COVAX Initiative, the broader vaccine distribution worldwide.

Pandemic has pushed the increasing of digital economy worldwide. The less contact economic activities happened in the forms of virtual meeting, e-learning, telemedicine, online shopping, creative content economy, and leisure time activities. The consumer behaviours have changed significantly into more digital, health conscious, eco-friendly, price sensitive as well as local-based practices.

In Indonesia, there are 345,3 million cellular users. It means there are 125,6 percent of users comparing to total population of 270 million. In January 2021, the internet users reached 202,6 million with internet penetration covered 73,7 percent nationwide. During pandemic, the internet traffic has increased up to 15-20 percent since April 2020 with the most activities happened in non-urban areas for 56 percent and urban areas for 44 percent (Coordinating Ministry of Economics 2021).

In order to accelerate the economic recovery in the post pandemic, Indonesia focuses on the developing start-up as an income generating activity. As the G20 Presidency, Indonesia delivers Digital Innovation Network as an expanding program of Digital Innovation League commissioned by Italy, the former presidency. The elevation aims to facilitate the development of start-up database and venture capital among the G20 member states.

As the G20 Presidency, Indonesia arms itself with Digital Economy Task Force with four priorities. These are connectivity and post-covid recovery, digital skills and digital literacy, cross border data flow and free flow with trust, and elevation of digital economy task force.

Without a doubt, recovering from global health crisis could not be done without involving the role of women on MSMEs. As the G20 Presidency, Indonesia utilises the G20 Empower to develop networking on the private sectors among the member states especially identifying and supporting women leadership in that sector.

The G20 Empower has three priorities. Those are enhancing Key Performance Indicators on women leadership in the private sectors, strengthening the commitment of the private sectors to improve the female-run MSMEs, and applying private sectors’ best practices on women engagement on digital economy.

But why female-run MSMEs has been so significant for the G20 Presidency? In Indonesia, there are 52.9 percent of micro, 50.5 percent of small and 34 percent of medium female-run enterprises (International Finance Corporation, 2016). It meant these woman-led generating activities dominated the practices of MSMEs in Indonesia. The female-run MSMEs contributed to 9.1% of Gross Domestic Product (GDP) or 1.381 billion Rupiah and their performance reached 21%, above the average global level on 8% (International Finance Corporation, 2016).

In Indonesia woman-led MSMEs has run faster to adopt digital technology and have strong resiliency to manage the formalization of their businesses. Before pandemic, there were 32 percent of female-run MSMEs accessed online marketplace and increased into 47 percent during pandemic. At the same time, the male-run MSMEs only raised up from 25 percent into 40 percent during pandemic (Ministry of Women Empowerment and Child Protection, 2021).

Certainly, the three advantages from within are not shortcuts to leverage the Indonesia’s G20 Presidency. However, we should all believe that these advantages still can be used to exercise Indonesian position as G20 Presidency.

REFERENCES

Coordinating Ministry of Economics. (2021, September 30). Ekonomi Digital dalam Kerangka Kerja Sama G20. Paper presented at the Presidensi Indonesia di G20: Prioritas dalam Mewujudkan Inklusifitas dan Keberlanjutan. Jakarta, Indonesia: National Research and Innovation Agency (BRIN)

International Finance Corporation. (2016). Women-Owned SMEs in Indonesia: A Golden Opportunity for Local Financial Institutions. Washington DC, USA: International Finance Corporation, World Bank Group.

KPCPEN. (2021, July 22). 208.265.720 Orang Target Sasaran Vaksinasi Covid-19 di Indonesia. Jakarta; Indonesia: Komite Penanganan Covid-19 dan Pemulihan Ekonomi Nasional (KPCPEN), Kementerian Komunikasi dan Informatika (KOMINFO).

KPCPEN. (2021, November 18). Cakupan Vaksinasi Lengkap di Indonesia Melebihi Target WHO. Jakarta, Indonesia: Komite Penanganan Covid-19 dan Pemulihan Ekonomi Nasional (KPCPEN), Kementerian Komunikasi dan Informatika (KOMINFO).

Ministry of Women Empowerment and Child Protection. (2021, October 7). Presidensi Indonesia di G20: Prioritas dalam Mewujudkan Inklusifitas dan Keberlanjutan. Jakarta, Indonesia: National Research and Innovation Agency (BRIN)

Emilia Yustiningrum completed her PhD from Griffith University, Australia, in September 2021. She is a researcher at the National Research and Innovation Agency (BRIN), formerly known as Indonesian Institute of Science (LIPI), Indonesia.

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