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ByteDance-owned TikTok intends to provide an e-commerce company with billions in acquisition

June 19, 2023: On Thursday, the video app TikTok, held by ByteDance, said it would finance billions in Southeast Asia over the upcoming years as it doubles down on the region amid intensifying global scrutiny over its data security.

Southeast Asia, a region with a collective people of 630 million, half of them under 30, is one of TikTok’s biggest markets in terms of user numbers.

“We’re going to invest billions of dollars in Indonesia and Southeast Asia over the next few years,” TikTok CEO Shou Zi Chew said at a forum organized in Jakarta to highlight the social and economic impact of the app in the region.

TikTok did not provide a detailed spending plan breakdown but said it would invest in training, advertising, and supporting small vendors looking to join its e-commerce platform TikTok Shop.

Chew said content on its platform was becoming more diversified as it added more users and expanded beyond advertising into e-commerce, allowing consumers to purchase goods through links on the app during live streaming.

He added that TikTok has 8,000 employees in Southeast Asia and 2 million small vendors selling their wares on its platform in Indonesia, the region’s biggest economy.

According to data from Momentum Works, E-commerce transactions across the region reached nearly $100 billion last year, with Indonesia accounting for $52 billion.

TikTok facilitated $4.4 billion of transactions across Southeast Asia last year, up from $600 million in 2021, but it still trailed far behind Shopee’s $48 billion of regional merchandise sales in 2022, Momentum Works said.

TikTok’s investment plan comes as the Chinese-owned company faces scrutiny from some governments and regulators because of concerns that Beijing could use the app to harvest user data or advance its interests.

Countries including Britain and New Zealand have banned the app on government phones, moves TikTok said it believed were based on “fundamental misconceptions” and driven by broader geopolitics.

TikTok has repeatedly denied that it has ever shared data with the Chinese government and has said the company would not do so if asked.

The app has not faced significant bans on government devices in Southeast Asia but has been scrutinized over its content.

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