AI could add US$55b to Indonesia's economy if SME adoption catches up

Artificial intelligence could generate up to US$55 billion in additional economic value for Indonesia if small and medium-sized enterprises (SMEs) adopt the technology at the same rate as larger companies, according to new research highlighted by Google.

The findings, drawn from the AI Economic Opportunity Report 2026 by Public First, position AI as a key driver of Indonesia's next phase of economic growth, as the country looks to build on its rapidly expanding digital economy. Indonesia's digital gross merchandise value (GMV) is projected to reach US$340 billion by 2030, supported by its young, digitally connected population and growing creator economy.

The report suggests that closing the AI adoption gap between SMEs and large businesses could contribute the equivalent of 3.8% of Indonesia's GDP, while supporting the creation of 510,000 new jobs through new products, services and business models.

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Currently, only 14.5% of SMEs use AI, compared with 62.5% of larger enterprises.

According to the findings, full adoption of generative AI tools across Indonesia's creative and media sectors could generate US$4.1 billion in annual economic value. Creative professionals are also expected to save an average of 390 hours a year - equivalent to around 50 working days - allowing them to spend more time on storytelling and creative development.

AI-powered localisation tools, including automated translation, subtitling and dubbing, could meanwhile unlock an additional US$410 million in annual creative exports by helping Indonesian creators reach overseas audiences more efficiently.

The report also indicates that Indonesian users are becoming increasingly sophisticated in their use of AI. Intermediate and advanced users account for 63% of AI users in Indonesia, compared with 46% in the US, while almost half regularly employ multi-step workflows such as meta-prompting, self-critiquing and comparing outputs across different AI platforms.

"What is most encouraging is how naturally Indonesians have embraced this technology. Today, Gemini is the most searched-for AI assistant in Indonesia. Gemini is also the highest-performing large language model for Southeast Asian languages. In fact, 84% of users here use Gemini in Bahasa Indonesia," said Markham Erickson, vice president of government affairs and public policy, centres of excellence, Google.

YouTube ecosystem continues to grow

Google also highlighted YouTube's expanding contribution to Indonesia's creative economy.

According to the latest YouTube Impact Report, the platform's creative ecosystem contributed more than IDR 8.4 trillion (US$467 million) to Indonesia's GDP and supported over 190,000 full-time jobs in 2025.

The report found that 81% of Indonesian creators use YouTube to share local culture, music and stories with global audiences. At the same time, viewers spend more than 95% of their news watch time on Indonesian local news channels, underlining the platform's role in news consumption.

Media companies are also increasingly collaborating with creators as they diversify revenue streams. The study found that 81% of Indonesian media companies on YouTube view creator partnerships as one of the main ways to increase revenue over the next five years.

"We have always held one core belief: technology is at its best when it serves as a partner that empowers human creativity. And its impact is truly tangible," said Veronica Utami, country director of Google Indonesia.

"As we enter the era of AI, the synergy between technology and human creativity has become more important than ever. To realise its full potential, we must work collaboratively to ensure our digital ecosystem remains open, inclusive and safe for everyone."

Trust and content authenticity remain central

Alongside the economic projections, Google emphasised the importance of trust and transparency as AI-generated content becomes more widespread.

The company highlighted SynthID, its invisible watermarking technology that embeds digital signatures into AI-generated text, images, audio and video. Google said SynthID has already been used to watermark more than 100 billion images and videos globally.

It also pointed to YouTube's Content ID system, which helps copyright holders identify protected content while ensuring creators receive appropriate attribution and compensation.

Google added that it continues to invest in AI literacy through initiatives such as Bangkit Bersama AI, which has trained more than 380,000 Indonesians, alongside expanding access to AI tools and digital infrastructure to support the country's long-term digital transformation.

"As an Indonesian who is deeply active in the digital space, I want to see Indonesians not just as users of technology, but as the ones shaping it - active participants who promote and determine what this digital space will become," said vice minister of creative economy, Irene Umar.

Discover what's next in Indonesia's fast-moving digital landscape at DMA Indonesia 2026 on 13 October in Jakarta, where marketing leaders will explore how AI, creator ecosystems, social commerce, and omnichannel strategies are reshaping customer engagement and business growth.

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