BONSERNEWS.com– The management of the short video application TikTok, Thursday, June 15, 2023, said the company owned by ByteDance from China will make massive investments in Southeast Asia that reach billions of US dollars over the next few years amid pressure from a number of countries who are worried about data security side of the platform.
Southeast Asia, a region with a population of 630 million – half of whom are under 30 – is one of TikTok’s biggest markets. There are around 325 million users who access the application every month.
However, the platform has not mapped out a user base that can become a source of income e-commerce mainly in this region. The reason is that TikTok will be dealing with a number of electronic trading platforms or e-commerce others that existed before, such as Shopee, Lazada, and Tokopedia.
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“We will be investing billions of dollars in Indonesia and Southeast Asia over the next few years,” said TikTok CEO, Shou Zi Chew, at a forum in Jakarta.
TikTok does not provide details of the investment plan. However, it said they would invest in training, advertising and supporting small vendors who wanted to join the platform e-commerce TikTok Shop.
CEO of TikTok, Shou Zi Chew, Thursday, March 23, 2023. (Bonsernews.com/voaindonesia.com/AP)
Chew says content on its platform is becoming more diverse as it adds more users and expands ads to e-commerceallowing consumers to buy goods via links in the app during live streams.
TikTok has 8,000 employees in Southeast Asia, and 2 million small traders selling their wares on its platform in Indonesia, which is Southeast Asia’s largest economy, he added.
Transaction e-commerce in Southeast Asia reached nearly $100 billion last year, and $52 billion of that came from Indonesia, according to data from consultancy Momentum Works.
TikTok facilitated $4.4 billion in transactions across Southeast Asia last year, up from $600 million in 2021. However, it still lags far behind Shopee’s regional merchandise sales which reached $48 billion in 2022, according to Momentum Works.
TikTok’s investment plans come as the Chinese-owned company faces scrutiny from multiple governments and regulators over fears that Beijing could use the app to harvest user data.
A person holds a smartphone with the TikTok logo in the background, November 7, 2019. (Bonsernews.com/voaindonesia.com/REUTERS/Dado Ruvic)
Countries including the UK and New Zealand have banned use of the app on government phones, a move TikTok said was a “fundamental misunderstanding” and driven by wider geopolitics.