Indonesia will review a US$100 million investment proposal from Apple Inc. as the tech giant aims to reverse the government’s ban on iPhone 16 sales.
The Ministry of Industry announced on Wednesday evening that Apple has proposed building a manufacturing plant for accessories and components in Southeast Asia’s largest economy. The ban on iPhone 16 sales, imposed in October by Industry Minister Agus Gumiwang Kartasasmita, stems from Apple’s failure to meet Indonesia’s domestic content requirements for smartphones and tablets.
A ministry spokesperson, Febri Hendri Antoni Arif, stated that Minister Agus will meet on Thursday to evaluate Apple’s proposal. “This indicates the industry minister is receptive to Apple’s investment commitment,” Febri noted in a statement.
The proposal marks a significant escalation in Apple’s efforts to regain market access. Bloomberg News reported that Apple’s latest offer is nearly ten times higher than its initial proposal of around US$10 million, which failed to address the ban.
iPhone 16 Ban Linked to Domestic Content Rules
Indonesia’s 40% domestic content requirement has been a sticking point for Apple, whose local investments—including developer academies—total only 1.5 trillion rupiah (US$95 million). This falls short of the 1.7 trillion rupiah commitment needed to comply with the regulation. The country has also blocked sales of Alphabet Inc.’s Google Pixel phones for similar reasons.
The stricter enforcement of these requirements aligns with President Prabowo Subianto’s push to strengthen local industries. These efforts reflect a broader strategy to demand higher investment commitments from international tech companies operating in Indonesia.
A Growing Pattern of Economic Protectionism
This is not the first time Indonesia has taken a hard stance against foreign tech firms. In 2023, the government introduced regulations forcing ByteDance Ltd.’s TikTok to separate its shopping feature from the main app, a move aimed at shielding local retailers from competition with cheaper imported goods.
Apple’s proposed manufacturing plant, if approved, could serve as a blueprint for how international companies can align with Indonesia’s economic goals while maintaining market access.