2024-11-26 05:46:00
Indonesia has rejected US group Apple‘s proposal to invest $100 million in the country to lift the ban on iPhone 16 sales, saying it lacked the fairness demanded by the government.
At the end of October, Jakarta banned the marketing of iPhone 16, accusing Apple of not investing enough in the country.
Indonesian authorities, who are trying to boost investment by foreign technology companies, say Apple is not complying with regulations requiring 40% of its phones to be made from parts from Indonesia.
Following this ban, Apple proposed to increase its investments by 100 million dollars (95 million euros) in Indonesia to allow the sale of new phones in the country.
To explain the refusal of this proposal, the Minister of Industry, Agus Gumiwang Kartasasmita, estimated in a press release published Monday evening that the American group did not meet the government’s requirements, particularly in relation to the technology giant’s investments in other countries.
“Currently, Apple still has not invested in production facilities or factories in Indonesia,” it said in a statement.
The ministry urged the group to immediately establish a production facility or factory in Indonesia “based on the principles of equity, so that the company does not have to file an investment plan proposal every three years “, he added.
Southeast Asia’s largest economy has a young, tech-savvy population, with more than 100 million people under the age of 30 – out of a total population of 280 million – but Apple still hasn’t no store in the country, forcing buyers to go through resale platforms.
Indonesia also banned the sale of Google Pixel phones in early November for the same reason, saying the tech giant had failed to meet requirements to source 40% of its parts from Indonesia. .
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What are the implications of Indonesia rejecting Apple’s $100 million investment proposal for the tech industry in Southeast Asia?
**Interview with Dr. Sarah Lim, Tech Industry Analyst**
**Editor:** Welcome, Dr. Lim. Thank you for joining us today. As we know, recent reports indicate that Indonesia has rejected Apple’s proposal to invest $100 million in exchange for lifting the ban on iPhone 16 sales. What are your thoughts on this development?
**Dr. Lim:** Thank you for having me. This decision by Indonesia is significant for a few reasons. The government has been emphasizing fair trade practices and local benefits, particularly as they seek to bolster their manufacturing sector. By rejecting Apple’s offer, they are signaling that they expect a more balanced agreement that directly benefits the Indonesian economy and aligns with their broader economic goals.
**Editor:** That’s a very insightful take. How do you think this rejection will impact Apple’s operations and their strategy in Indonesia?
**Dr. Lim:** Apple has been actively looking to diversify its supply chain, especially in light of global uncertainties and the need to lessen reliance on China. The company’s CEO, Tim Cook, mentioned that they are considering manufacturing in Indonesia during a recent meeting with President Joko Widodo. This rejection could complicate those plans. Unless Apple can negotiate terms that are deemed fairer and more beneficial for Indonesia, they might have to reconsider their investment strategies or face continued regulatory challenges.
**Editor:** Interesting. Given this context, do you think Apple will manage to adjust its strategy effectively, or is there a risk of a prolonged impasse?
**Dr. Lim:** It really depends on how willing both parties are to negotiate. Apple has considerable leverage due to its brand and technology, but Indonesia is also motivated to protect its market interests and ensure any foreign investment is genuinely advantageous for its economy. If Apple approaches negotiations with a more collaborative mindset, they might find common ground. However, if they push too hard, or if Indonesia remains firm on its stance, we could indeed see a prolonged impasse.
**Editor:** Thank you, Dr. Lim, for sharing your insights on this complex situation. It will certainly be interesting to see how this unfolds in the coming months.
**Dr. Lim:** Thank you for having me. I look forward to seeing how this dynamic evolves.