The iPhone 16 sign is seen in the window of the Fifth Avenue Apple Store on the day of the new product launch on September 20, 2024 in New York City.
Michael M. Santiago Getty Images News | Getty Images
The Indonesian government expects Apple to increase the proposed $100 million investment into the country, according to state media, as the iPhone maker sought permission from Jakarta to sell its latest phones.
The American tech giant’s latest smartphone model does not meet Indonesia’s 40% domestic content requirement for smartphones and tablets and has not yet been given permission to be sold in the country.
The aim of the ban is to protect local industries and jobs, with officials asking Apple to increase its investment and commitment to the economy in order to gain more access.
According to reports from Indonesian state media, the country’s Ministry of Industry met with representatives from Apple on Thursday about a proposal to invest $100 million over two years.
The funds will go to research and development center programs and professional development academies in the country, according to the report.
The company also plans to make accessory product components, specifically for Apple’s AirPods Max, from July 2025, it added.
Apple did not immediately respond to a request for comment from CNBC.
While the new offer is 10 times larger than the previously reported proposal, the government is still working on a deal to get “fair” commitments.
“From the government’s point of view, of course we want this investment to be bigger,” Industry Ministry spokesman Febri Hendri Antoni Arif told state media on Thursday.
He said that greater investment would help the development of Indonesia’s manufacturing sector, adding that the domestic industry could support the production of Apple devices such as chargers and accessories.
While Indonesia represents a small market for Apple, it also offers growth opportunities as it has the fourth largest population in the world, according to Le Xuan Chiew, a Canalys analyst focused on Apple strategy research.
“A young and tech-savvy population with increasing digital literacy aligns with Apple’s strategy to expand (global sales),” he said, adding that it also offers potential for manufacturing and assembly that support Apple’s efforts to diversify its supply chain.
Success in this market requires a long-term approach, and Apple’s investment offer shows its commitment to comply with local regulations and pave the way for future growth, he added.
