I INTRODUCTION
Indonesia’s unique and strategic territorial characteristics are promising for ‘digital voyagers’ to influence and spread usage of disruptive technologies such as Internet Mobile, Big Data, Internet of Things (IoT), Automation of Knowledge, and Cloud Technology. The ultimate goal of the technology emerging development is none other than to boost economic growth in a globalized regime which is indirectly enforced by global institutions such as the United Nations Sustainable Development Goals , World Bank , and International Telecommunications Union (ITU).
Technology has become a new form of discourse under the practices of development. A new form of emerging strategy that is influenced by the West due to its knowledge and innovation, is widely progressing in Indonesia in almost all sectors of life. This type of new development strategy has become a powerful instrument to conquer the country, with even sovereign government becoming an extension of the hand of the ‘technology empire’ which perpetuated the developmental practices.
The pursuit of modernity to counteract traditional issues such as alienating poverty, inequality of knowledge and lack of infrastructure, motivates the advancement of economic growth. Nonetheless, observers of colonialism argue that the effect of digital technology intervention to salvage developing countries brings sustainable subjection to Indonesian societies. Digital postcolonialism is not a novel term, however, it is rather a two-sided coin that is inseparable, one aspect being how science and scientific enterprise facilitated colonial development.
This paper indicates that the government strategy through technology transformation is merely a continuation of the old colonialism era. The technology transformation is only a new discourse or tool for western civilization in the globalization era. International development institutions identify ‘new abnormalities’ and create new standards. It forces developing countries for global competitiveness in achieving economic growth through technology adoption. Most of the strategies, programs, existing laws are sourced from foreign recommendations and international experiences, including in “Innovate Indonesia – Unlocking Growth Through Technology Transformation” policy paper . Most of the result benefited for foreign investments, private and exclusive state-owned enterprises and governments. While those who are not developed by technology are fall behind and generates wider digital divide.
The end of this paper shows that Indonesian government pro-growth strategy through technology transformation does not provide significant impact for Indonesian society, rather for fulfilling universal indicator. The economic growth indicator follows the trend of technology innovation that constantly evolving and accelerates overtime. This means the indicator for economic growth will also exponentially growing and more challenges occurs due to digital divide.
This research paper will examine the technological transformation strategic policy of Indonesia towards digital postcolonial conundrums. Part II of this paper will elaborate on the overview of digital postcolonialism in Indonesia and factors that drive the phenomena. Part III will explain Indonesian government’s strategies for transforming the country through technology adoption in order to boost economic growth as their only focus. Finally, Part IV will examine Indonesian government’s strategy of technology transformation towards digital postcolonialism.
II AN OVERVIEW OF DIGITAL POSTCOLONIALISM
A Origin of Digital Postcolonialism
Refer to Sandra Harding’s Postcolonial Science and Technology Studies (PSTS), digital postcolonialism is identified as ‘multiplicity of local struggles that historizes symbolic postcolonial violence and in exposing the ways in which powerful actors continue to authorize the marginalization of indigenous knowledge systems.’ Modernity and coloniality are two sides of the same coin, and that one of its aspects is concerned with how science and the scientific enterprise formed part of and facilitated colonial development, herein refers to the usage of digital technology and Information & Communication Technology (ICT).
This theoretical framework assist the analysis of the outcome and impact of technology development in developing countries like Indonesia because technology and colonialism are dialectically intertwined and one cannot be thought of without the other. In the context of postcolonialism, the emphasis is on the imperialism at the level of infrastructure which is dominantly attributed to technological imperialism. This theory asserts that imperialism as an ideology is driven by the technology industry as the empire of state instead of nation-state.
PSTS scholars observe that technology colonialism is a continuation from the old concept of colonialism. Several of the pillars within this concept show us the connectivity. The most notable pillar refers to the relationships between the digital territories and the digital settlers. The new mechanisms of reproduction of postcolonial connectivity are directly and indirectly linked to ICT and digital technologies. The central argument of this theory lies on the migration of digital settlers through the operation of modern creation and innovation to the spacious area in society that is still “primitive” based on their origin of knowledge. This condition sets up the idea of ‘new poverty’ among ‘primitive nations’ who do not have the knowledge and capacity of technological innovation and adaptation (technological lag).
In Hussein Alatas’s The Myth of the Lazy Native, he asserted that ‘digital colonialism has created their own class of digital natives – people who were born into the world of ICT, their most able users, the true citizens of the network society.’ By using the example of trade as common practices in daily lives and the need to gain economic welfare for both Northern and Southern countries, the Western globalization diminishes the local trade merchants that exist in developing countries. The introduction of ICT and digital technology have indirectly proclaimed that “traditional standards” shall be replaced by digitalization of things. As claimed by Hernando de Soto, the emerging strategy progressively leads to production modernization so that it empowers local entities for unleashing people’s wealth, solving social issues and spatial uneven development and increasing local competitiveness.
Hence, the digital settlers use new method from old colonialism. Technology is merely a replacement of weapon which become the primary tool for colonizing the ‘savages’. ‘Digital postcolonialism reveals the economic and social relationships between the users and the non-users of ICT, between the global North and the Global South, between the rich and the poor, between the oppressor and the oppressed.’
The new developmental orthodoxies of digital technology formalize a tighter social relation between the powerful and the ‘other’ by providing aid of ‘knowledge and innovation’ which constitutes a network of power relations. To shift primitive activities and to achieve social progress that constantly evolves and is influenced by the fast pace operation of innovation by the Northern countries, the digital settlers ‘execute’ their motives to diffuse digital technology innovation and application to ‘primitive’ society. This occurs at a staggering rate through the idea of ‘technology transformation development’.
B Key Driver of Digital Technology Development in Fostering Economic Growth
1 Modernization to Neoclassical of Growth Theory
The law and development discourse were firstly initiated by the rise of modernization theory in the mid-twentieth century. In the 1950s, modernization theory emerged to be responsible for tackling social and political factors by supplementing economics in theorizing the preconditions and obstacles to development, which is conceived as the modernization of traditional societies. According to Walt Rostow, there are preconditions for traditional society to be able to ‘take-off’ that were fulfilled by key economic changes, including trade expansion and increases in investment. “‘Take-off’ would happen if the total investment in the economy reached 10% of Gross Domestic Product (GDP) and both industrial and agricultural productivity outstripped population growth.”
In Rostow’s ‘stages of economic growth’, it is important to include science and technology in achieving a departure from traditional society which is mostly (but not entirely) technological. It drives the maturity of economic growth and modernization of economy of more diverse goods, including technologically sophisticated ones and greater integration into the world economy. This condition leads to a high mass consumption society which is the ultimate goal for the modernisation of society where basic needs are exponentially broadened. This in turn contributes to an increased GDP rate.
Nonetheless, modernization theory failed to embark in developing countries due to the negativity associated with it being the basis of US government policy of capitalist power after the Second World War. Neoclassical of growth theory become a supplementary approach in the late twentieth century which remain shaped by the Weberian conceptualization of law’s relationship to economic growth. Robert Solow used the neoclassical growth model as the basis for decomposing the growth in output per capita into portions accounted for by increased inputs and the portion attributable to increased productivity.
The author argues that the central theory lies in Fridriech Hayek’s arguments of neoclassical theory with its emphasis on the political and legal conception of liberty. Hayek supported the ideal society which maximised individual liberty and the fulfilment of individual creative freedom. This idea leads to technological determinism where its usage altered the increase of productivity factors input, measured by economic growth. During the 1960s, neo-classical growth theory was practiced and people generally accepted its approach to modelling growth in the long-term. Technological improvement in the form of ‘learning by doing’ has improved productivity and increased more investment in industry as well as increasing a greater division of labour.
The neoclassical of growth theory addresses the following three main points:
‘Firstly, technological change is the driver of economic development. Secondly, technological change and innovation depend on a hierarchy of capabilities, at the individual, firm and national levels. Thirdly, the acquisition of capabilities is itself constrained by a range of institutional and political economy factors. Thus the processes of technological diffusion, adoption and adaptation are embedded in these structures.’
The theoretical approach provides an in depth understanding about how technological transformations revolutionized the society of developing countries where there is a requirement of social policy and regulations to diffuse the benefits that arise from technological production equally to the societies. For policymakers, this theory consisted of production function movement which opens more production possibilities where capital and labour are incorporated to produce massive output.
Although technological transformation is so exogenous that it becomes the main driver of economic growth, the technology itself is a black box. Technology is both essential factor that drives economic growth and also creates the possibility of low-income traps for poor countries like Indonesia. The reason is the society has not absorbed technology equitably. Furthermore, Joseph Schumpeter affirmed that technology progress is perhaps an accumulation of capitalist progress to enhance economic growth. Constant waves of technological innovation and entrepreneurism drives the capitalist economic development. This progress is also a result of deliberate actions taken by private agents who respond to market incentives.
2 Urgency of International Development Growth Indicator in Technology
The International Development Growth Indicator has become a rapid tool for assessing and promoting diverse social justice and reform strategies around the globe. International development agencies such as the World Bank (WB) have invented a wide range of indicators and the most accepted one is the GDP. They are the basis of modern forms of governmentality including the strategic decision of deploying technological development to a certain country or area. The indicator is basically a technological product itself, its sources highly depending on the construction of ethnicity, gender, income and national income. To this extent, national income continuously becomes the source of alternative for governments from emerging-developing countries like Indonesia to escape from the classification of low-income countries or ‘poor country’.
Furthermore, the indicator of ‘new poverty’ has become a new problematization which enforces a solution to be resolved by the concept of development. The way international institution calculates and examines ‘poverty’ , emphasizes capital accumulation such as technology, classifications of GDP/GNP per capita, modes of knowledge, and decision-making systems. Poverty measurement is crucial for informing policy-making and improving the lives of people living with unequal social welfare and who are deeply vulnerable. However, indicating poverty itself is one critical aspect to measure because it is rather political and is not self-evident. Whether technological transformation has the capability to eradicate poverty in Indonesia is one open ended discussion.
Another influencing global indicator is the Sustainable Development Goals 2030 (SDGs), created by United Nations Development Program (UNDP). According to SDG’s report, around 103 out of 169 targets of SDGs’ 2030 are influenced by technologies. Generally, Information and Communication Technology (ICT) and digital technology contributes the most in development deployment because the purpose of it is to support infrastructure accessibility and cost efficiency. The national reformation strategy of technological transformation is believed to advance the GDP rate among developing countries, including in Indonesia.
Nevertheless, similar to the previous indicator body, the idea set of SDGs’ is highly contested – ‘sustainability’, ‘development’ and ‘goals’ are subjective and politically sensitive. The notions of “all human beings can enjoy prosperous and fulfilling lives and that economic, social and technological progress occurs in harmony with nature” are highly contested and raises the question who is the ‘human’ that benefited from SDGs implementation?
3 The Characteristic of Technology is Exponential and Infinite
The characteristic of technology is exponentially growing and evolving. The technological progress continues to speed up indefinitely and that technology innovation is accelerating, even doubling every decade. This framework presupposes the economic growth that depends on technological progress and innovation for more business opportunity and investment throughout the world. Technology particularly ICT, is the second level of exponential growth (the exponent), because technology becomes more cost effective and more resources are deployed towards its advancement. Undoubtedly, technology provides easier way for fulfilling human needs that are growing continuously.
According to Lewis Mumford, technology comes in two varieties. First is ‘polytechnics’ – life oriented which integrated with broad human needs and potentials. Second is ‘monotechnics’ which produce mega machines that can increase power dramatically. This modern technology often creates disenchantment to the world population but only benefits some sectoral industries. Science and technology often result in very unevenly distributed benefit, costs and risks, which further creates the science and technology studies. Since science and technology are the result of social activities by humans, the development discourse uses technology as the tool for expanding growth to countries that have not been intervened by this method. Furthermore, the idea of development is strongly connected to technology because its characteristics to modernize the ancient/savages with new technology innovation which always become a struggle in developing countries. It is a struggle because there will always be winners and losers or victors and vanquished that falls behind. Those who falls behind are the indirect impact from technological progress in most developing countries.
III STRATEGIES OF DIGITAL TECHNOLOGY TRANSFORMATION IN INDONESIA
A Overview of Indonesia’s Technology Transformation Strategy
The emergence strategy of technological development in Indonesia is crystallized in President Joko Widodo’s notable policy known as the ‘4.0 industrial revolution’. It is the ‘prime mover’ for Indonesia’s economy so that the country will be able to attain the top ten (10) of global economic power based on GDP in 2030. In order to do so, Indonesia must be qualified under the following classifications:
i. “Indonesia must contribute ten (10) percent net export to GDP;
ii. Indonesia must multiply twice productivity cost of its ratio in order to boost investment of profit; and
iii. Indonesia must allocate two (2) percent of GDP to Research and Development (R&D).”
Joko Widodo and his cabinet uses technology advancement to accelerate his political (agenda) under economic motivation for modernizing Indonesia which is mainly driven by the application of ‘disruptive technology’ or digital technology. It is part of Joko Widodo’s ambitious pro-growth agenda which focuses on large-scale infrastructure development, fiscal reform and dramatically improving business climate.
The global environment which constituted GDP as a universal indicator adversely affected Indonesia’s competitiveness in its manufactured exports including increase in economic openness, shorter product cycles and continuous technological improvements. The government was increasingly encouraged by technology transformation after noticing that the digital technology implementation raised 7.3% of Indonesia’s GDP in 2017. The World Market Monitor estimates the digital economy will contribute to the national economy approximately USD155 billion or about 9.5% towards Indonesia’s GDP until 2025.
Bank data of indicators and the measurements above accelerates Indonesian government to formalize their strategies to long term policies and legislations. The National Medium-Term Plan (RJPMN) is the legal predication for the elected president to execute their developmental strategic plan throughout the reign time. Other supplementary legislations are the National Medium-Term Plan 2020-2024, President Regulation No. 74/2017 on Roadmap of E-Commerce 2017-2019 and the latest is the Policy Paper: Innovation Indonesia – Unlocking Growth Through Technological Transformation established by the Ministry of Finance (MoF) with partner consultant, Asian Development Bank (ADB). The current ‘pro-growth’ legislations and policies mainly focus on the investment in infrastructure building of technological development to fostering economic growth that enables Indonesia to become a competitive player in the global market. ‘Pro-growth’ policy indicates that investment infrastructure greatly affect quality equity in the longer run. The massive digitization infrastructure building is estimated to increase productivity all over the country. Hence, massive investment distribution and budget allocation must be prioritized for conducting technological transformation. Infrastructure investment attracts more foreign direct investors to open their business/industrial practices to compete with local markets as well as ‘assisting’ the less knowledgeable through Transfer of Technology (ToT).
Nevertheless, Indonesia’s unique archipelago condition with a total area of 1,904,556 km consisting of 17,504 islands, 9,634 of which are not named, become both a challenge and opportunity in digital postcolonialism lenses. The solution of ‘unlocking growth’ or ‘pro-growth’ through technology development is an ostensible progress. Moreover, it generates longstanding inequitable issues of social and economic welfare such as poverty, food security, job opportunity, and illiteracy which has remained for centuries in Indonesian history.
B Technology Development Strategy: Indonesia – ADB’s Working Policy Paper
In this section, the author provides example of a comprehensive working policy paper entitled Innovate Indonesia – Unlocking Growth through Technological Transformation by the MoF and its foreign partner, ADB. The study shows some of the challenges Indonesian industries faces and some solutions were offered by utilizing international experiences as example within the Five Pillars strategy. From this study, the author argues that the proposal offered were a foreign product and does not indicate the urgency of Indonesian society for implementing the technology adoption as proposed.
The first pillar, advanced innovation infrastructure and institutions, shows that Indonesia’s investment towards technology is very low and inadequate compared to other countries in the ASEAN region. Especially in rural areas, there has been low investment in research and design which only contributes 0.08% of gross domestic expenditure. The paper resulted a comparison between Indonesia and OECD countries which known to be measured with economic and international trade standards. Therefore, the paper offers a long-term approach in improving the provision of telecommunication and internet infrastructure so that the economic growth can be achieved. The most prominent national program which refers to the international telecommunication program called Universal Obligation Program (USO). But the program requires more improvisation and updates according to the evolving standards which reviewed annually by international experts (critiques over this program is explained in other section).
The second pillar suggests to more awareness of the business value of new technologies. The key findings from this study is that more improvement and update for local firms’ understanding and knowledge of the business values arising from new technologies. Of the firm’s surveyed, 50% of firms did not see the urgency to invest in new technologies. The study, however, did not provide sufficient reason whether this is due to lack of awareness, disinterest, or incompatible with their local culture. The study addressed that Japan, Germany and France provide approaches such as the establishment of industrial networks and develop international linkages connecting to local factories and international suppliers with the state-of-the-art technologies. However, ADB provide international examples which are not representative of developing countries who have different traditions and cultures.
The third pillar promotes technology transfer and technical support for firms. The study acknowledge that Indonesian enterprises are at different stages of their technology transformation journey. Perhaps, some are still behind with technology adoption due to their social-cultural environment in each territory. The study surveyed that 64% of Indonesian enterprises have not exploited with technology benefits which available in the market. They offer stratified approach which highlights on the replacement of traditional manufacturing technologies with 4.0 technology industries.
The 4.0 technology industry emphasizes on the digital world which is fast paced and constantly evolving. As offered, technology transfer can be in a form of open access of more information, technical training, fiscal incentives, and credits to firms which are more demanded by firms in Indonesia. The manufacturing evolution in Korea exemplified a successful story of investment for particular sector – heavy industries, by providing financial incentives, subsidies and ToT program for strategic industries through foreign procurement from the United States. However, the example used was investment in heavy manufacturing industries which most of it are profitable for government or private investment – not the local and small enterprises. Even in western countries like Australia who have adopted digital world, receiving equal technical support is remain a major constraint across many industries. The study does not provide sufficient examples that indicates success story of local indigenous enterprise in developing countries that able to close the technology gaps by ToT as solutions.
The fourth pillar offers low cost plug and play technical solutions for Indonesian firms. Most of Indonesian low-income firms hinders with the high cost access of technology adoption into their systems. The study suggests by taking advantage from technologies that are becoming more broadly available and whose costs are gradually fall. One of the approaches is by selecting potential options of technologies that can apply to common requirements among Indonesian firms. However, the end of this pillar suggest that it requires more advice and more financial support to achieve the strategy successfully.
Finally, the last pillar enforces a technologically savvy workforce among Indonesian firms. It requires replacement of old manufacturers with smart digital equipment that supported by robust IT software and internet of things. A study showed that 70% of Indonesians are under 39 of age and only 1/3 of the population have internet access and called ‘tech-savvy’. It requires assistance from international trainers to improve digital literacy and more development of institutions to meet the technology-based business requirement.
The proposed skill for having tech-savvy workforce was comprehensive, however, the study did not mention indication regarding equitable access to these resources or whether these institutions would be subsidised across all sectors of Indonesian society. Otherwise, the digital divide may increase due to this approach and may harm the rest of traditional agriculture or local business throughout the country. The impact of tech-savvy workforce may only increase the attractions from foreign traders to invest and it certainly may increase Indonesia’s economic growth as the direct impact from technological progress. While the overall economy may improve and looks promising statistically, part of the workforce has been recruited externally or come from the 1/3 of the population with internet access. Leaving more gaps behind and some jobs are getting more vulnerable than the others. The policy paper did not mention that it will bring equitable impact to Indonesian societies, especially to the most outer territory.
IV EXAMINATION TOWARDS INDONESIA’S TECHNOLOGICAL TRANSFORMATION STRATEGIC POLICY IN TACKLING DIGITAL POSTCOLONIALISM
This part continually examines the Indonesia’s Technology Transformation Strategic Policy in the contestation of digital postcolonialism circumstances. The author argues that Indonesia’s pro-growth strategy utilizing technology development as the new development discourse does not provide a sufficient and equitable impact for Indonesian society. It merely sustains the postcolonial power in the globalization era through technology development which focuses on economic growth for business sectors, trade export and productions.
A New Object, Same Rules? Preservation of Colonial Actors and Practices in New Emergence Technology Strategy
1 Technological Transformation Strategy as New Discourse of Development in Indonesia
The idea of transition discourse is emerging nowadays with particular richness, diversity, and intensity to the point that a veritable field of ‘transition studies’ can be posited as a scholarly political domain. Transition discourses have become a prominent field of culture, ecology, religion, and spirituality, alternative science food and energy, and certainly for the digital technologies. They posit a radical cultural and institutional transformation which brings transition in altogether in a different world. French scholar, Aimé Césaire, connects this new strategy as the new ‘theatre of development’ where the creators of technology can be assumed by the colonized by initiating act of creation including the development of new technologies to claim assistance for countries who are not yet in line with northern countries (underdeveloped). As Beard puts it, “development discourse represents a very real and effective form of imperial power that is concerned with the maintenance of a particular (western) version of subjectivity through its appropriation of history by means of a continuous and ‘hazardous play of dominations’ that have hardened the discourse of development.”
The way the transition operates is by incorporating technology application into people’s knowledge and skills as a path to solve real-world problems. Globalization influences national government to fulfil the reign of multinationals new standardization of unchecked ultra-liberalism of world markets which cannot be resisted from a purely local standpoint. Thus, technology becomes the new arena of that tool for such fulfillment. ‘Technology voyagers are known as the new colonizer that convinces global south countries with new problems of globalisation such as technology backwardness and low rate of GDP.
The emergence of technology diversifies many options for people’s lives by adopting or rejecting the usage of the given innovation. The result is either beneficial or disruptive depending on how the societal systems function within it. It is undoubted that technology support employment but it also reduces some conventional and traditional jobs that may be suitable for indigenous and local residents . This has been the effect of the government and development institutions who think that ‘modernization’ through technology transformation can be an efficient way of social problem-solving intervention.
The technology transition aimed by the Indonesian government is a part of a radical instrument of the new development course. It is part of economic globalized civilization which has been taken into force by the debates over growth and development internationally and regionally. The competition of growth and development has been immensely evolving especially through the introduction of technology innovation by most Northern countries’ firms and corporations in order to boost economic growth. Samiullah and Rao (2000) argue that new technologies are brought to developing countries to fight rural and urban poverty which in fact, the issues of poverty indicators itself is still debatable. By improving economic performance and the ability to compete in global markets, they provide a means, for exploiting the unused labour force and increasing social capital.
Gilhooly stipulated that the nexus between new technologies and achievements of Millennium Development Goals (MDGs) is recognized and is based on mutually shared objectives, which are “efficient, scalable, affordable, and pervasive delivery of goods, services, and information flows between people, government, and firms”. This universal standard raised by MDGs/SDGs, World Bank and other foreign development studies reported by development partners like the ADB is one of the main triggers for Indonesian government to compete at a regional and international level.
The author argue that this has become a geopolitical rather than driven by social motives for fairer welfare distribution among people. The policy paper ‘Innovate Indonesia’ clearly stipulated that the strategic transformation pillars are sources from selected international policy initiatives from around the world which enforce various levels of strategies, institutions and funding levels that have been deployed to assist technology transformation in several developing countries. To that extent, the technology transformation is becoming a political tool of the government for gaining as international political reputation by achieving the highest score of the universal indicator formulated by MDGs/SDGs or other international standards.
2 Perpetuation of Colonial Practices by the Government Institution
Research study stipulated that the technology transformation presupposes postcolonial system in the global south like Indonesia is strengthened by the formation of “triptych” – government, market and subject. There is link that exists from the first wave of colonial practices until the current postcolonial approaches which is this paper focus in – digital postcolonialism. The first “triptych” system of the digital postcolonialism suggest that government practicalities is the most central concept for which power has been utilized and perpetuated. Escobar affirms that “governmentality” and imperialism are central concepts which can describe not only relations between States, but also relations between States and firms, foundations, development banks, etc. Policy strategies deployed by the Indonesian government and the ADB are a part of governmentality practices to support the exploitation of another opportunity which aims to obtain the same purpose with the old concept of colonialism – capital gain and growth.
A Slight difference from the old colonial practices that is occurring within the technology transformation, is that colonial actors are not only played by the northern countries but also by the Indonesian government supported by development partners acting as middlemen. The national strategies to transform Indonesia through technology application is a manifestation of foreign strategies for exploiting new territories that have not yet developed or intervened by technology application. The postcolonial state government asserted its unity through the industrialization and modernization as contended in neoliberal theory of growth and modernization theory above. It is also contended that the state government used the development idea to suggest it was attempting, without any differentiation background and that it could be the only solution for economic growth and welfare of all citizens through concerted program of industrialization – hence refers to technology transformation in this paper. This occurs a justification of state intervention including with foreign partners in numerous fields of activity and political organizations-fields previously localized and managed by traditional community.
For example, the infrastructure building of a wireless program to rural areas including the outer islands’ territory is a deployment of digital post colonialist activities which aims to gain more GDP earnings by building telecommunication infrastructure, called Universal Service Obligation (USO). The program received most of its funds from private telecommunication companies as stipulated under 2009 Government Act No 7. The author argues the USO operation is another way to intervene and exploit new tools of development by foreign stakeholders because through foreign direct investments, trading companies, and foreign expert channels like ADB access of technology acquisition for the transformation is attained. As stipulated from a research study, the USO Program did not originate from local initiatives of the Indonesian government but rather originated from AT&T’s President, Theodore Vail “One System, One Policy, Universal Service” in 1914. Theodore Vail asserted that USO program policy operates through cross subsidies sourced from the State Budget to support affordability of telecommunication access, which in turn comes from the society who pay their taxes.
The deployment of foreign strategies has been long adopted by the former Indonesian president as well. In the 1994 Presidential Decree Number 39, the government announced the establishment of a Joint Operating Scheme between local telecommunication company (Telkom) with foreign telecommunication companies, such as AT&T (USA), Cable Wireless (UK), France Cables and Radio (France), NTT (Japan) and Telstra (Australia). This collaboration scheme has been conducted up until today and most of these foreign companies put upward 95% of capital and sharing of 70% of revenues for the term of contract.
The universality of telecommunication accessibility is an international framework policy with its implementation measured under the following strategic policy:
i) Market based reform;
ii) Mandatory service obligation;
iii) Cross-subsidies; and
iv) Universality funds.
The implication of this operational strategy policy as a result of the Technology Transformation policy paper is to support the achievement of GDP and economic growth. It pertains to more capital investment and consumption through tariffs and service fees that mostly come from state budget and private funding (profit) and in the end they use the profits for more infrastructure building instead of giving direct subsidies to poor people. Thus, it can be argued that technology transformation deployed by the government is for profit gaining purpose instead of moral or welfare distribution. The effect of the technology transformation and development can be severe, knowing that it will raise more digital divide due to lack of knowledge from the exponential technology diffusion to Indonesia society.
B Challenges to Technological Transformation
1 Inequality among Indonesian societies: ‘modern’ vs ‘savages’
This part questions the unequal result derived from the technology transformation in Indonesia. As mentioned earlier, digital divide and lack of knowledge among Indonesian society became one of the major challenges for fulfilling the aim of Indonesia’s growth strategy distribution. New technologies create new inequalities and heighten existing ones. Instead of succeeding in creating economic equality, it actually widens the gap through the development of technological infrastructure especially when there is still an absence of equal training and information distribution. The approach taken by Indonesian government is mostly informed by foreign programs and standards such as the UN SDGs 2030.
The application of digital technology is more prone for the usage of technological commercialization. As Jared Diamond puts it, “technology, in the form of weapons and transport, has provided the direct means by which some peoples have expanded their realms and conquered other people” – savages. The rich gain more profit due to the advancement of the infrastructure that has been deployed through the State Budget and subsidized programs than those who earn less or those unable to access the education of technology adoption. The policy strategy of Innovate Indonesia is merely a strategy to boost economic growth exclusively for those who have privilege to use the digital technology adequately such as expatriates, foreign companies and selected state owned enterprises. The central element for boosting economic growth is importing more FDIs, trade relationships and exporting more production to broaden their business in other areas that have not yet developed with technology infrastructure.
Although the USO program is advertised as the tool for building infrastructure equally, this does not mean that equality will be achieved. It rather widens the digital divide between people who can make more profit from the subsidized program for making improvement of income from the technology adoption and those people who are less privileged . Moreover, with the introduction of smart machines and other types of AI technology in job areas, digitalization becomes an intrusion for people who work with manual or traditional equipment. The technology also comes with other drawbacks that to some extent, create distraction to human labour while on the job. . USO program which creates connectivity from ICT could lead to greater error, lower productivity – even abuse and addiction.
For example, the exponential spread of social media usage is the ultimate impact of digital technology interconnectedness. Because of the internet and the widespread mistargeted digital technology implementation in the region of Indonesia, the control of the rich-content of internet is weak. Most of the Indonesian people use the interconnectedness of ICT not for production effectivity, but for venture to unnecessary websites or activities that are not work-related. Furthermore, the tariffs that most digital and telecommunication imposes are increasing. People’s culture is getting more consumptive by paying more bills for internet providers. The impact is broadening to the change of culture (consumptive culture). Therefore, the urgency of technology education prior to technology transformation and its diffusion to Indonesia population should be the prioritized investment allocation.
2 Unprepared Legislation and Policy on Regulating Technology Diffusion
The alignment between the vast movement and development of new technologies and existing legislation and policies is not synchronized thoroughly. Although there is legislation to cope with the telecommunication infrastructure, e-commerce, and Indonesian cyber law on electronic transaction, the governing laws to manage the technology diffusion so that it will be distributed and benefited evenly to Indonesian people are not yet explored.
Even with the implementation of enacted related laws and policies with technology transformation, these usually refer to foreign laws and strategies which focus on the efficient usages of technology for enhancing capital investment and economic growth in countries with vastly different demographics. The reason is, naturally, it is hard to expect global south countries like Indonesia to re-invent digital technologies from scratch. Instead, they buy northern technologies and usually re-write and adopt northern laws, and northern social inclusion policies to be aligned with the procured/imported technologies.
Very seldom laws in Indonesia appropriate to indigenous social and cultural issues in respect with technology transformation are considered nor is there an emphasis on eliminating poverty that has a cultural element. Most existing laws and policies are suggested by foreign institutions with an i emphasis on the urgency for governing education, capital technology, and research and innovation as the fundamental element for improving economic productivity. Whereas, the third world issues in Indonesia still persist, the introduction of technology transformation by the MoF and ADB is going to further complicate the existing social and cultural issues of poverty among Indonesia society.
3 Investment on Infrastructures: A Sustainable Debt
One of main constraints in Indonesia is to provide equal infrastructure on every region in Indonesia. The Ministry of Communication and Information of Indonesia affirmed that it is a hindrance to provide an equal infrastructure to support the economic activity overarchingly, especially to people who are at risks with low income and lack of education.
The Innovate Indonesia policy paper suggest that the government prioritization goes to the allocation of infrastructure capacity building, including technology infrastructure. To deliver Joko Widodo’s infrastructure drive, his strategy has entailed increasing budgetary allocations (cutting energy subsidies), capital injection and directly allocating major projects to heavy reliance on state owned enterprises and expediting land acquisitions for building the infrastructure. In another ADB paper which aims to assist government decision making for budget allocation, they initiated at least $27 billion in new ICT investment to reach full implementation of Indonesia Broadband Plan. The resource of the program mostly requires strong partnership with private companies which will provide 80-90% of fund to the program.
The result of the expediting R&D expenditure is to facilitate market access especially FDI and foreign trade expansion to boost the economy. The existing laws related to ICT development is mainly focusing on technology efficiency for business to boost export, productivity and growth and development so that the return of investment and sustainable economic growth will be achieved. The consequence is that local governments are required to pay the fees to the private provider and telecommunication services which are obtained from collaboration fees, paid partnerships and procurement. In other words, investment on infrastructure is another way of sustaining foreign debt for technology improvement.
C Economic Growth - Unreachable Target
Should poverty in Indonesia be reduced by growth and development, including through technology transformation? Escobar asserts that poverty itself is an organizing concept which became a new problematization in the globalization era. ICT is not a goal in itself but merely a tool for development. Since digital technology evolves, the government uses this new development discourse for eradicating poverty system in Indonesia.
Research study has analysed Indonesia’s economic growth strategy in connection to digital technology development (particularly in ICT) as follows:
i) “Preliminary analysis shows that the key indicators of ICT development have shown an increasing trend in recent years compared to the early year of 1980 to even 2000;
ii) Empirical results based on the model used by this study indicate a long-run cointegrating relationship between ICT development and economic growth;
iii) The coefficient of long-run elasticity of economic growth linked to ICT development is positive and statistically significant. This shows that the ICT development brings positive effect to economic growth of Indonesia. Nonetheless, the magnitude of this impact is very low;
iv) Based on export led growth, ICT development is being used as regressor and the result from the assessment is negative for economic growth and the impact is very weak; and
v) The study suggests that ICT development is imperative for long-run growth in Indonesia. However, the study suggest that the government should not only focus on the exponential usage of ICT development but also target increased ICT-related investment.”
These results indicate that Indonesia still lacks technology and innovation capability for the benefits of economic growth. The reason for this is that many technology adoptions have not generated significant impact for the economic benefits of all socio-demographic areas Indonesia. Lack of inclusive legislations and policies, and lack of education to the targeted areas for the technology transformation are only few of the remaining challenges.
To this extent, government will improve its strategies and policies through more studies with foreign partners assisted by foreign partners which more emphasizing on achieving economic growth. Even if Indonesia will someday reach the amounted standard of GDP, technology transformation is not going to eliminate the common issues of poverty, minimum wages, illiteracy, and social status division. The government’s strategies towards the target of technology transformation is also not specific for eliminating third world issues, but rather to fulfil universal standard of economic growth.
Noticing the character of technology is evolving continuously , the economic growth standard will also increase indefinitely. This makes a vicious cycle for the poverty rate and more people will be divided amid the technology development and innovation adopted in Indonesia. The author argues that this has become a legitimacy of deeper digital postcolonialism, conducted not just by foreign entities, but also supported by national government policies due to their ambition for obtaining the universal standard of GDP.
V CONCLUSION
In conclusion, Indonesia’s strategic policy for fostering economic growth through technological transformation is not merely an effective option. It embraces ‘new identified abnormalities’ of digital postcolonialism that impact to Indonesian society, including digital divide. The new discourse of technology development is merely a sustainable tool for attaining capital gain through investments, infrastructure, and knowledge diffusion so that high mass consumption will be achieved and raise Indonesia’s geopolitical reputation related to global competition. Hence, the strategic policy proposed by the Indonesian government rather prolong historical issues of poverty which have existed since 350 years of Dutch colonization. While technology innovation and economic growth accelerates simultaneously, it is marginalized and creates further divide throughout the country. The critical character of technology and economic growth that evolves exponentially has become a sustainable development tool of digital postcolonialism.
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