Tariffs, Trade, and Technology: Why Indonesia Must Build Cybersecurity from Within
By JagaMaya — Indonesia’s Trusted Cybersecurity Partner
Jakarta | April 2025
A New Frontline: Indonesia’s Digital Sovereignty Under Pressure
In the 21st century, power is no longer measured solely in military strength, but in algorithms, data pipelines, and control over digital infrastructure. As global politics tilt toward economic nationalism and technological self-reliance, Indonesia faces a pressing question:
Can we secure our future if our digital foundations are built abroad?
The reinstatement of Trump-era trade policies, including a 32% retaliatory tariff on Indonesian exports to the United States, has sent shockwaves through our trade ecosystem. But the consequences extend far beyond economics. They strike at the heart of our digital sovereignty and cybersecurity readiness.
Investment Paused, Risks Amplified
A recent report by Bloomberg, “Microsoft Pulls Back on Data Centers From Chicago to Jakarta”, underscores a larger vulnerability: foreign hyperscalers may hesitate or withdraw from expanding in regions affected by trade tensions.
When that happens, Indonesia’s ability to scale cloud infrastructure, secure critical sectors like finance and healthcare, and protect our digital ecosystem becomes fragile. The tariff is not just a trade issue—it’s a wake-up call.
We must ask:
- Can we defend our digital borders with systems built and governed outside our control?
- Can we rely on infrastructure priced in foreign currencies and exposed to foreign politics?
The answer must be clear: Indonesia must build from within.
Ripple Effects: From Delayed Projects to Talent Flight
Indonesia’s digital competitiveness is under threat. As capital is redirected toward neighbors with more favorable policies—such as Malaysia, Thailand, and Vietnam—Indonesia risks becoming a bystander in Southeast Asia’s digital race.
Key Risks to Indonesia’s Cyber Resilience
| Strategic Risk | Impact |
|---|---|
| Project Delays | Slower rollouts of cloud infrastructure, smart cities, and public sector digitalization |
| Reduced Investment | Hyperscaler hesitancy and capital flight |
| Supply Chain Disruptions | Delays in cybersecurity hardware and data center equipment |
| Brain Drain | Migration of skilled tech talent to more stable markets |
| Loss of Digital Sovereignty | Overdependence on foreign platforms and standards |
The Way Forward: Digital Patriotism and Self-Reliance
Now is not the time to retreat—it is the time to build. JagaMaya calls for a national commitment to secure Indonesia’s digital future with solutions created by Indonesians, for Indonesians.
Four Actions to Secure Our Cyber Sovereignty
1. Build a Stronger Local Tech Industry
“We cannot secure national systems with foreign-built walls.”
Indonesia’s overreliance on imported cybersecurity tools and data center equipment exposes us to external shocks. To reverse this, JagaMaya and IDPRO recommend a comprehensive National Tech Industrialization Strategy that includes:
- R&D Tax Incentives: Offer aggressive credits for companies developing security appliances, cloud hardware, and firmware locally.
- Import Substitution Roadmaps: Identify critical components like firewalls and power units for local manufacturing.
- SOE–Private Sector Joint Ventures: Encourage collaboration between state-owned enterprises (e.g., PT LEN, PT INTI, PT Telkom) and startups.
- Domestic Procurement Policies: Prioritize local solutions for government infrastructure projects.
This is not just about economic efficiency—it is about resilience, security, and independence.
2. Accelerate Strategic Trade Diplomacy
“The next trade war will be fought over data, not steel.”
Indonesia must reposition itself as a strategic and secure digital partner through proactive diplomacy and international agreements. Key actions include:
- Digital Trade Agreements: Establish bilateral and multilateral digital pacts with the U.S., EU, Japan, and India.
- ASEAN Cybersecurity Pact: Lead a regional alliance for data sovereignty and cybersecurity standards.
- Infrastructure Carve-Outs: Advocate for national security exemptions in future trade discussions.
- Global Branding: Promote Indonesia’s commitment to ethical, inclusive digital infrastructure.
Through strategic diplomacy, Indonesia can shape—not just react to—the future of global digital policy.
3. Invest in Indigenous Innovation
“Innovation should not wait for permission or foreign capital.”
Indonesia’s cybersecurity breakthroughs must come from within. JagaMaya proposes the following to support homegrown innovation:
- National Cybersecurity Innovation Fund: Launch a fund for developing zero-trust platforms and AI-driven security tools.
- Startup Procurement Programs: Mandate government IT projects to allocate contracts to certified local startups.
- University-Industry Research Hubs: Establish cyber labs at institutions like UI, ITB, and UGM to co-develop export-grade tech.
JagaMaya’s Modular Ecosystem is proof that Indonesia can build end-to-end cybersecurity solutions—customized, scalable, and sovereign.
4. Enforce National Laws with Local Infrastructure
“Laws alone do not create sovereignty. Infrastructure does.”
Indonesia already has a solid legal foundation with:
- UU No. 27/2022 (UU PDP): Requires strict localization of personal data.
- PP 71/2019: Mandates onshore data processing for strategic systems.
However, compliance must go beyond paperwork. Indonesia needs:
- Locally hosted data, in locally owned facilities.
- Security tools developed and maintained within the country.
- Certification standards that prioritize both security and sovereignty.
Legal mandates must be matched with infrastructure capacity. Sovereignty is operational control—not outsourcing.
Building for the Future: JagaMaya’s Commitment
Indonesia must not just consume digital technology—we must create it.
At JagaMaya, we are:
- Developing 100% locally-built cybersecurity solutions for government and enterprise
- Supporting the national agenda through partnerships with IDPRO and Indonesian tech ecosystems
- Advocating for long-term investment in local capacity and innovation
This is not a threat—it’s an opportunity.
The disruption caused by tariffs is a catalyst for transformation. What we build with our own hands cannot be taken away. As we march toward Indonesia Digital 2045, let us build with purpose, defend with pride, and lead with independence.
Conclusion: The Best Cybersecurity Is Independence
Tariffs may shift. Trade policies may change. But a resilient, sovereign cybersecurity infrastructure—designed, developed, and deployed in Indonesia—will stand the test of time.
Let us seize this moment to shape our destiny.
Let us build what no one else can take away.
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