TikTok Shop set to reopen after $1.5 billion agreement in Indonesia

TikTok and Indonesian company GoTo have agreed to work together to bring back TikTok’s online shopping in Indonesia.

The company, which is owned by a Chinese company called Bytedance, wants to invest more than $1. 5 billion in the long run in Indonesia’s largest online shopping website, Tokopedia.

In October, the TikTok Shop closed in Indonesia because of new rules in the country’s biggest economy in Southeast Asia.

TikTok is used by about 125 million people in Indonesia.

TikTok is going to buy a little more than 75% of Tokopedia and combine its business in Indonesia with TikTok Shop.

“The partnership will start with a test period done with input and oversight from the regulators,” the two companies said in a statement they released together.

GoTo and TikTok will help Indonesian businesses sell more products and improve how they make and sell things.

The Indonesian government banned online shopping on social media to protect smaller sellers and people’s personal information.

Many of the 270 million people in Indonesia use social media a lot. They were TikTok’s largest online shoppers until the ban started in October.

The ban was announced after Indonesia’s President Joko Widodo warned about being cautious with e-commerce in September. Rules can be helpful, but things can go wrong without them.

Internet shopping in Indonesia has grown a lot in the last few years. E-commerce sales in Indonesia will increase a lot, from 2018 to next year it will be 689 trillion Indonesian rupiah which is equal to $44 billion and £35 billion. This information is from the central bank of Indonesia.

TikTok Shop has been getting more customers since it started two years ago in Indonesia’s online shopping market. This market is mostly controlled by platforms like Tokopedia, Shopee, and Lazada.

The rules in Indonesia were another problem for TikTok. The app is also being looked at in the US, European Union, and the UK. The UK Parliament has banned the app from its network because of security concerns.