Is there room for TikTok shop in Indonisia?
TikTok said it will halt e-commerce transactions in its TikTok Shop app in Indonesia from Wednesday, after the country brought in a ban on e-commerce trade on social media last week.
"Our priority is to remain compliant with local laws and regulations. As such, we will no longer facilitate e-commerce transactions in TikTok Shop Indonesia by 17:00 GMT+7, October 4,"
Traditional and online retailers, like $Sea Ltd(SE)$ & Lazada $Alibaba(BABA)$ could benefit from the restrictions.
Some other problem in Tiktock Indonisia
Apart from the separation of social and e-commerce, there are actually many hidden contradictions between TikTok and Indonesia.
TikTok has always operated in Indonesia as a Singaporean company, without establishing a local company. The e-commerce license is also held by a Singaporean company, and the tax rate in Indonesia for the Singaporean company is not high. As of the closure, third-party channels predicted that TikTok Shop's GMV in Indonesia in 2023 could reach 20 billion US dollars, and due to the significant amount, different corporate entities will generate substantial differences in taxes.
Furthermore, most of TikTok's non-local employees in Indonesia work in the form of tourist or business visas, which does not strictly comply with Indonesian legal requirements.
As is well known, TikTok Shop's low-priced products have indeed to some extent squeezed the survival space of local small and medium-sized businesses in Indonesia. After the new regulations were introduced, ministers also worried whether it would cause panic among Indonesian small and medium-sized sellers.
However, from the results, although many TikTok Shop sellers have closed, it has not formed a large-scale discussion, which to some extent reflects that merchants do not seem to have received satisfactory returns from TikTok Shop。
Is there still a chance for this matter to turn around?
However, the source also mentioned that closing TikTok Shop may not be the final result, but whether a solution that meets the requirements of the Indonesian government, the Indonesian public, and TikTok Shop's interests can be found may still require effective communication between the two high-level parties.
"From my perspective, Indonesia has no intention of attacking TikTok. It seeks a win-win situation, so there is room for maneuver in this matter."
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BABA, JD, and BIDU were beloved stocks and now they're all down 60-70% from their peak with no recovery in sight. These are blue chip companies too, not newer growth companies like Nio.
$阿里巴巴(BABA)$ Of all the big techs in China, this is the only one in red! That says a lot about this stock!
TikTok for financial advice 😂Isn’t every video only like 15 seconds long? I’m trying to imagine myself talking really really fast to pitch a stock.
Sentiment around SE has changed with the TikTok ban.
It’s a trap guys be careful!! It will end red in hk market