Image credit: Tech Wire Asia
KUALA LUMPUR: There must be a constructive approach towards TikTok Shop, and regulators and relevant ministries must carefully examine the platform's influential role and consider the broader implications for the Malaysian digital economy landscape.
E-Commerce Malaysia, the chapter of the National Tech Association of Malaysia (Pikom), urges Communications and Digital minister Fahmi Fadzil to consider concerns related to TikTok Shop.
These concerns echo the reasons behind Indonesia's recent prohibition of TikTok Shop, which stemmed from predatory pricing and data protection issues.
"At Malaysia's end, banning TikTok Shop inadvertently restrains the growth and reach of our local businesses, especially the micro, small and medium enterprises (SMEs), which constitute a significant 78.4 per cent of businesses in our nation.
"TikTok Shop has catalysed a seismic shift in social commerce, connecting creators and businesses directly with consumers for e-commerce," e-Commerce Malaysia chair Ganesh Kumar Bangah said at the sidelines during the Insights into Malaysia's Digital Job Market & Economic Outlook 2023/24 briefing today.
He said TikTok Shop is the big new idea in online shopping as it mixes social media and selling things online in an even more impactful way than older sites like eBay were when they first started.
Further, TikTok Shop has also seamlessly integrated content creation with commerce, providing a novel, accessible and engaging platform for SMEs, creators and e-commerce enablers to converge and thrive.
Ganesh said that against this backdrop, Malaysia's digital marketplace narrative is distinct from Indonesia, which boasts several giant, locally-owned marketplaces.
He said that given that prominent e-commerce marketplaces operating in Malaysia, such as Lazada and Shopee, are foreign-owned, outright bans on others could potentially stifle the entrepreneurial spirit among the rakyat and local businesses.
This scenario particularly impacts the B40 demographic adversely by limiting accessible platforms to sell their goods, he noted.
"Hence, e-Commerce believes that what needs to be addressed is TikTok Shop's role and responsibility within our local business environment," said Ganesh.
E-Commerce Malaysia's recommendations include community engagement, whereby TikTok Shop should prioritise proactive dialogue with industry associations, creator communities and e-commerce enablers regarding local policies.
Decisions, especially those which might adversely impact the local business environment and TikTok Shop's standing, should be made collaboratively rather than unilaterally.
Secondly, TikTok Shop should also uphold and foster local capacities by prioritising the capacity building of local creators and e-commerce enablers over foreign ones through workshops, training and platform tools that enable local players to navigate and leverage the digital market effectively and ethically.
Thirdly, through community investment, TikTok Shop should also partner with local communities, industry associations and government agencies to co-fund capacity development programmes for local creators and SMEs that enhance the capabilities and competitiveness of local entities.
By prioritising local brands and enablers, TikTok Shop should prioritise local brands and e-commerce enablers over foreign-owned ones by ensuring that local consumer traffic is channelled to local brands and e-commerce enablers rather than foreign-owned ones.
"At its end, the government, while keeping a firm eye on local interests, can craft policies that do not solely exclude global platforms like TikTok Shop but encourage them to weave constructive community investment and involvement into their operational fabric.
"This ensures that while they extract value from our markets, they simultaneously infuse beneficial resources, knowledge and opportunities back into our local economies," said Ganesh.
He said such measures include balanced regulatory measures by implementing policies that ensure a level playing field in the domestic digital marketplace, preventing any entity from exploiting the market through predatory pricing or compromising consumer data protection.
"Our aim should be to foster a digital economy where all participants, local and foreign, contribute equitably and do not exploit the system to the detriment of others," he said.
Secondly, inclusivity in prosperity, whereby new strategies that can ensure the economic benefits trickle from global platforms are distributed equitably among local entities, particularly safeguarding and empowering the B40 segment, including rural communities and kampung sellers.
Ganesh said e-Commerce Malaysia and Pikom envision a future where global and local digital entities co-exist and collaborate, each reinforcing the other towards a thriving, equitable, and sustainable digital economy.
"In carving out a digital future, policies should not only shield but also skillfully utilise global innovations to nurture and elevate our local digital landscape.
"We unreservedly extend our expertise and advocacy, pledging to work hand-in-hand with the government and international platforms.
"Our collective effort aims to nurture a future where Malaysia stands robustly positioned persistently within the global digital arena, benefiting our economy and societal development in this thriving digital age," said Ganesh.
Source: https://www.nst.com.my/business/economy/2023/10/966373/constructive-approach-regulators-stakeholders-needed-towards-tiktok