The iPhone 16 series was forbidden in Indonesia last month due to Apple’s unfulfilled investment commitments to the country. Cupertino responded with a promise to invest $10 millionfollowed by a second promise to boost the figure with a bonus $100 million which would cover the initially committed amount of IDR 1.71 trillion ($109 million) in local R&D facilities.
It seems that Apple’s increased investment commitments are still insufficient. Indonesia’s Ministry of Industry reportedly rejected Apple’s offer during an internal meeting led by Minister Agus Gumiwang Kartasasmita. According to a spokesperson, the local government wants Apple to invest more and make Indonesia part of the global supply chain.
From the government’s perspective, we naturally want this investment to increase. A larger investment would facilitate the development of Indonesia’s domestic manufacturing sector and help the country become part of Apple’s global supply chain. – Febri Hendri Antoni Arif, spokesperson for the ministry
Indonesian law requires foreign companies to provide 40% local content to operate in the country as part of the Domestic Component Level (TKDN) certification. Companies can meet these requirements by producing products locally, developing software locally or setting up R&D centers.
Apple originally committed more than IDR 1.71 trillion ($109 million) in local R&D facilities, but has only invested IDR 1.48 trillion ($95 million). Apple has reportedly considered expanding production of accessories and components in Indonesia, which seems to be what the local government is after. By failing to meet investment criteria, Apple is now facing an indefinite ban on its iPhone 16 and Apple Watch 10 series in Indonesia.