Building awareness key to growing Indonesia’s security technology sector

Since the 2002 Bali bombings, Indonesians have grown more and more cognizant of the importance of having a strong security system. But a lack of concept and strategy in providing a secure and safe space hampers the adoption of the latest security technologies. A strong local presence is needed to tackle this particular challenge.

Four years on, Jakarta has piled onwards on its mission to become a smart city. Spearheaded by the Jakarta Smart City (JSC) program, which was jumpstarted by former governor Basuki Tjahaja Purnama in 2014, the city has been able to make progress in terms of improving public service by way of digital technology.

According to the JSC, the program has been helped the city administration to reduce the resolution time of people’s reports from 300 hours to 28 hours on average. The JSC also made the most use out of the over 7,600 CCTV units currently installed in the city - up from only 118 CCTV units in 2014 – utilizing the technology to monitor crime, traffic congestion, flood and waste problems.

The JSC is just an example of how Indonesia is an example of how security technology providers can rely on the market to grow. The city has already set aside Rp 92.38 billion (US$6.5 million) to further develop the applications and the infrastructure of the program, as well as in terms of research and development. According to the JSC, the program requires a total of Rp 187.6 billion in 2019 worth of funds to further push Jakarta into becoming one of the world’s smartest cities - Jakarta currently ranks 47th out of 50 of the world’s smartest cities according to Singapore-based Eden Strategy Institute.

When viewed from an infrastructure perspective, Indonesia, not just Jakarta, possess various opportunities for security technology providers. The construction sector, long considered a main pillar of the nation’s economic development, continues to grow, reaching a five-year high of 10.05% in share of GDP as of 2018. The property sector, a growth point for various security technology solutions, is facing a challenging cycle due to a surge of supply and slow demand. But even then, the construction of new buildings in Indonesia continues to grow with an average completion rate of 15% per year for the last five years.

One prospective sector is hotels. Since 2014, Indonesia has experienced a rapid growth with regards to the tourism industry and the government has targeted of 20 million foreign tourists by 2019. There was an increase of 66,31% of incoming foreign investors staying in star-rated hotels in 2018 in comparison to 2013 with 9.5 million. In 2018, the country was ranked no.9th in the world based on the highest growth of tourism sector, according to the World Travel and Tourism Council (WTTC). This is another opportunity in which security technology providers may find potential business partners.

The main challenge, according to a number of key stakeholders, is the lack of awareness and know-how of the various security risks currently at large, as well as the security technology available to counter these risks. This lack of awareness further hampers the ability of many developers to conceptualize and strategize the right technologies for their security needs.

Darwin Lestari Tan, a member of the advisory board for the Indonesian Security System Industry Association (AISKINDO), said many developers do not properly plan for the installation of security systems, leading to higher costs in maintenance for systems that don’t get utilized. “There is a gap between over security high cost, under security high risk. This is where we have to find the balance,” Mr. Tan said.

The gap may be attributed to the relative newness of Indonesia’s security industry. The various associations tasked with growing the sector have only begun propping up in the last few years or so. The aforementioned AISKINDO was only established three years ago in 2016. Meanwhile, the Indonesia System Integrator and Security System Association (ASISINDO) was only declared two years ago in 2017 as a sister association of the Indonesia ICT Business Association or APTIKNAS. The Indonesian Security Professionals Association (APSI) was declared in 2014.

This is because the breadth of the security industry has grown significantly in the last few decades. Indonesia only became more aware of the importance of security technologies since the 2002 Bali bombings, which had spurred a rapid growth in the provisions of security guards. CCTV technology, in connection with the growth of digital technology as a whole, further expanded the possibilities allowed by having an advanced security system.

As such, a clear valuation of Indonesia’s security sector can be difficult to pinpoint, though the aforementioned associations have estimated that the sector could be worth up to Rp 2 to 3 trillion in annual terms. If Mr. Tan’s advice about awareness being a main challenge in developing the market is to be taken seriously, then any security technology provider interested in being a part of the industry must be prepared to establish a strong local presence.

In this regard, EKONID is hosting the Export Initiative "Civil Security Technologies and Services" with a focus on building and IT security in Jakarta, Indonesia, from September 1-5, 2019. The business trip includes a business forum with up to 100 expected participants from Germany and Indonesia from the industry sectors of civil security technology and services, building security and IT security as well as one-on-one discussions with potential business partners, arranged by EKONID according to your requirements.

Our Delegation Partners for this event is the Federal Ministry for Economic Affairs and Energy, BMWi-Markterschliessungsprogramm, BDSW - BUNDESVERBAND DER SICHERHEITSWIRTSCHAFT, BHE Bundesverband Sicherheitstechnik, Bundesverband IT-Sicherheit e.V., and econAN International.

For registration and further information please visit our website: https://bit.ly/2uYUd3S

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