Indonesia bans Temu over fears Chinese shopping giant will ‘destroy’ local SMEs

Indonesia has banned Chinese online marketplace giant Temu to protect its micro, small and medium-sized enterprises from getting “destroyed” and prevent cheap products from flooding the country.

Temu, owned by PDD Holdings, directly connects factories in China with consumers in more than 50 countries, such as Malaysia, Thailand and the United States.

Indonesian authorities have said the platform’s business model eliminates local stakeholders like resellers and shippers in the supply chain, allowing overseas companies to keep prices low that could squeeze small traders in Indonesia.

“No, Temu cannot enter because it damages the economy, especially Indonesian micro, small and medium enterprises [SMEs]. We will not give it a chance,” Minister of Communications and Informatics Budi Arie Setiadi said last week.

Budi said Indonesia’s digital space needed to be filled with things that “make society more productive and profitable”.

“If it is detrimental, what’s the point? We will ban it. Our micro, small and medium enterprises will be destroyed if left unchecked.”