US-based e-commerce giant Amazon has been in talks with the Indonesian government about entering Southeast Asia’s largest market, which could see the company finally execute a plan that has reportedly been in the works for over two years.
According to the country’s Finance Minister Sri Mulyani Indrawati, as reported by KataData, the discussion with Amazon has been about the terms related to its planned investment, including tax and other regulations.
“I’m now in discussion with Amazon, who is planning to enter Indonesia. I will make sure they comply with our country’s regulation, especially their readiness to pay the taxes,” said Indrawati.
A foray into Indonesia would mark the Amazon’s second push into Southeast Asia after it opened operation in Singapore last year, where it is pitted against Alibaba-backed Lazada.
Earlier reports about Amazon’s plan of investing in Indonesia date back to 2016, when the local media suggested that the e-commerce major had allocated about $600 million for the first year of its expansion in the Indonesian market.
Since then, however, the company has yet to make any significant moves. Over that period of time, it was instead Amazon’s global rival Alibaba that has made its mark in the Indonesian market by leading a $1.1-billion funding round into e-commerce unicorn Tokopedia.
Meanwhile, China’s Tencent holds a 36 per cent stake in New York-listed Sea Ltd., which owns e-commerce firm Shopee Indonesia, and Chinese e-commerce company JD.com has its own subsidiary in the country.
It appears that Amazon’s focus in the past few years has predominantly been on its operations in India, where it is locked in a fierce battle with rival Flipkart, which was recently acquired by US retail giant Walmart.