Indonesia remains adamant as it has upheld its ban on Apple’s iPhone 16, citing the US tech giant’s $1 billion investment proposal as insufficient to meet local content requirements.
The ban, enforced in October by President Prabowo Subianto’s administration, stems from regulations mandating that 40% of components in smartphones and tablets sold in Indonesia must be sourced locally.
The restriction also applies to Google’s Pixel phones, which have also failed to meet the same standard. Apple had offered to invest in a $1 billion plant to manufacture its AirTag tracking devices in partnership with a local firm but Indonesian officials have emphatically stated that the investment would not address the local content requirements for iPhones.
“As of this afternoon, the Ministry of Industry does not have the basis to issue the local content certificate for Apple products, especially the iPhone 16,” said Agus Gumiwang Kartasasmita, Indonesia’s Industry Minister, on Wednesday. Kartasasmita described Apple’s proposal as “not enough.”
Despite plans to operationalize the AirTag facility by 2026, officials argue Apple’s commitments remain inadequate. The tech giant’s earlier offers of $10 million and $100 million were also dismissed as insufficient compared to its sales in Indonesia, a lucrative market with over 354 million active mobile phones—far exceeding the population of approximately 280 million.
Apple operates four developer academies in Indonesia but lacks manufacturing facilities.
The company is yet to comment on the matter.
Indonesia’s demand for increased local investment underscores its strategy of leveraging its vast consumer market—the world’s fourth-largest—to attract foreign manufacturing and safeguard domestic industries. However, critics argue that the regulations deter investment.
The American Chamber of Commerce in Indonesia described the local content rules as “very challenging” due to the unavailability of domestically made components for certain sectors, such as electronics. Economists warn that bans on major tech products could harm Indonesia’s attractiveness to investors, especially as neighboring countries like Vietnam and Malaysia offer more favorable policies.
Meanwhile Apple executives are currently in Jakarta to negotiate the company’s investment plans with government officials.
Philips Babatunde