Indonesia has reportedly rejected Apple’s $100 million investment proposal, deeming it insufficient to meet the country’s “fairness” principles. The government is seeking further negotiations before lifting a ban on iPhone 16 sales.
Industry Minister Agus Gumiwang Kartasasmita criticized Apple’s investment disparity between Indonesia and Vietnam. While Apple has poured billions into Vietnam’s manufacturing facilities, its investment in Indonesia, a larger market, has been significantly less. “We want Apple to return to do business here but we need a fair resolution,” Kartasasmita said, as per a report in Bloomberg. He further added, “We want Apple to send negotiation teams to meet us.”
Why Indonesia has banned new iPhones
Indonesia’s ban on iPhone 16 sales stems from Apple’s failure to comply with local content regulations, which require 40% of phone components to be sourced domestically. The government is pushing for increased local manufacturing and investment from tech giants like Apple.
Apple’s latest offer, a $100 million investment, is still considered inadequate by Indonesian officials. The government is demanding that Apple fulfill its 2023 investment pledge, provide a more substantial offer for 2024-2026, and ultimately establish a manufacturing plant in Indonesia.
This isn’t the first time Indonesia has taken a tough stance on foreign tech companies. The country has also banned Google Pixel phones due to similar investment issues and imposed restrictions on TikTok’s shopping feature.
While Apple may not be a dominant player in the Indonesian smartphone market, the country’s large and growing tech-savvy population presents a significant opportunity for the company. Both parties are working towards a resolution that benefits both sides, but the future of Apple products in Indonesia remains uncertain.
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