Jakarta, CNBC Indonesia – Looking back, President Joko Widodo (Jokowi) previously issued a recommendation that the Indonesian people hate foreign products and love domestic products.
Related to this, the Minister of Trade Muhammad Lutfi said this happened because there were foreign e-commerce that sell imported products unhealthy and kill local MSMEs.
“It is necessary to clarify the background that accompanies the President’s statement. My report to him is about reports of inappropriate practices in e-commerce trade. Global e-commerce practices, which are illegal practices of predatory pricing, are prices that kill competition,” said Muhamad Lufti at that time, quoted on Saturday (5/3/2022).
“This is what Pak Jokowi actually hates. These are the actions that shouldn’t be allowed, these are what he hates,” he added.
This foreign e-commerce is said to sell goods that are imitating the production of domestic MSMEs. They also learn what Indonesian people like.
Even so, Lutfi said, e-commerce what is meant is a foreign international company, not a native Indonesian company. He confirmed that e-commerce what Jokowi hates isn’t it? e-commerce native to Indonesia such as Tokopedia, Bukalapak, and Blibli.
As for this, it is detrimental to local MSMEs because of the practice predatory pricingthat is e-commerce applying a very low price for a product so that it becomes a barrier for its competitors to enter the same segment or market.
This strategy makes domestic products, especially for the fashion category, lose competitiveness. Even though many Indonesian MSMEs sell various local goods on the platform e-commerce the.
“When we opened the digital platform on our cellphones, it’s true that the hijabs that the company sells are Rp. 1,900/pcs and that’s why they are called predatory pricing. We don’t compete because e-commerce is a subsidy or anti-dumping so that prices go down, competition is dead, the MSME industry is dying and this causes hatred for foreign products that the President said, because of events in trade that are unfair, unprofitable and useless, ‘ said Luffy.
Foreign entrepreneurs can sell the same product at a low price because they only pay an import duty of around US$ 44 thousand. Meanwhile, local entrepreneurs have to pay the salaries of employees who make these products at a cost of around US$ 650 thousand per year.
Therefore, he hopes that all countries can better enforce the two trade principles that have been set. Because Indonesia will also apply this to all its trading partners.
Both are the principle of justice and the principle of benefit. Trading practices must be fair and beneficial to both the seller and the buyer.