The row, and other devices Apple announced this fall is prohibited From sales in Indonesia. This is because Apple has defaulted on its local investment commitments of around $15 million.
Indonesia is said to have invested 1.48 trillion ($94 million) of the 1.71 trillion rupiah ($109 million) it has pledged to deploy in local resources and/or infrastructure to meet its requirements. Because Apple did not meet the investment threshold, the Ministry of Industry did not issue the certificates required to sell Apple’s latest products there. The ban does not affect older Apple devices that the company can still sell in the country.
Under Indonesia’s local content regulations, some devices sold there must contain at least 40 percent “domestic content.” This can be achieved, for example, by using imported materials, having manufacturing facilities or employing local workers. Apple has established four developer academies in Indonesia and was looking to start this year . Samsung and Xiaomi are among the smartphone makers that currently have factories in the country.
By not investing the remaining $15 million needed to meet the threshold, Apple cannot sell its latest products in Southeast Asia’s largest economy, which may show shortsightedness. Although it is hardly the most popular smartphone brand in Indonesia (not in the top six, Bloomberg notes), Apple has room to grow there. Indonesia is said to have a $1 trillion economy and an increasingly tech-savvy young population. The government also announced that there are 350 million active mobile phones in the country of 270 million people.
According to officials, there are about 9,000 iPhone 16s in Indonesia. These were mailed to the country or hand-carried by the crew and passengers. Bloomberg states that phones are allowed for personal use but cannot be resold. From 2020, any mobile phones bought and imported from abroad are subject to tax and must be registered with the Indonesian government.
