Apple Boosts Indonesian Investment to Lift iPhone 16 Ban
1min read Apple Inc. has reportedly agreed to increase its investment commitment in Indonesia to $1 billion, a significant escalation designed to overturn the prohibition on selling the iPhone 16 series within the country. The restriction was initially set by the Indonesian government in October, due to Apple's failure to meet local production requirements for components.
Indonesia mandates that at least 40% of the components for smartphones sold within its borders be locally manufactured. To comply, foreign companies typically partner with regional suppliers or procure parts domestically. Despite earlier pledges, Apple had not fully realized its investment, prompting the recent sales ban on its latest iPhone model.
In response, Apple's planned $1 billion investment represents a tenfold increase over previous proposals, which had been deemed insufficient by Indonesian authorities. The preliminary commitment has been termed as a "first phase" by Indonesia's Investment Minister, Rosan Roeslani, with an anticipated formal letter of commitment from Apple expected within the week.
Roeslani emphasized the importance of fairness, highlighting the necessity for foreign companies to invest in the local economy and generate employment. The upgrade in Apple's investment package is being interpreted as a move to foster goodwill and encourage technological industry growth in the region.
The Indonesian government has taken a firm stance against companies that fail to adhere to local content regulations, a stance that previously affected Google’s Pixel phones for similar reasons. As Southeast Asia's most populous nation with a rapidly growing market, Indonesia is a prime investment opportunity for global technology leaders like Apple.
On Tuesday, Roeslani reiterated the government's desire for Apple to provide more substantial terms than those extended in markets like Vietnam, where Apple has invested significantly in production facilities. This sentiment underscores a broader ambition to shift more of the global value chain onto Indonesian shores, thereby reaping greater economic benefits.
