ANALYSIS OF THE IMPACT OF DIGITALIZATION ON SMALL AND MEDIUM ENTERPRISES IN INDONESIA
Keywords:
Digitalization of SMEs, , Digital Economic Transformation, Technology Access Gap, Global Economic Inclusion.Abstract
This study aims to examine in depth the impact of digitalization on Small and Medium Enterprises (SMEs) in Indonesia in the context of national law and global developments. The main focus of the study is on the digital divide, national regulatory readiness, and comparison with international policies, especially in ASEAN and Global South countries. This study uses a juridical-normative method with a literature review approach, which includes analysis of primary legal materials (ITE Law, PDP Law, UMKM Law) and secondary legal materials such as reports from the World Bank, ADB, OECD, and comparative studies from Malaysia, Singapore, and Kenya. The results of the study show that digitalization offers significant opportunities for SMEs in accessing the global market, but still faces serious obstacles such as inequality in digital infrastructure, low digital legal literacy, and weak legal protection for SMEs from the dominance of large platforms. International comparisons show that the integration of the legal framework and affirmative policies is the key to the success of SME digitalization. Therefore, this study recommends updating more inclusive national digital regulations, integrating international cooperation into the domestic legal system, and strengthening digital legal literacy among SME actors as a transformation strategy towards a fair and sustainable digital economy
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