① The negotiations between Apple and the Indonesian government saw a last-minute reversal, with Apple executive overseeing the talks leaving Indonesia on Wednesday, while remaining team members continue negotiations; ② In October last year, Apple was banned from selling the iPhone 16 series due to failing to meet Indonesia's localization production requirements; ③ Apple proposed to invest 1 billion dollars to establish a factory and train students, but the Indonesian Minister of Industry insisted that Apple produce iPhone 16 components.
On January 9, the Financial Association reported (edited by Malan) that Apple's deal with the Indonesian government saw a reversal on Wednesday. According to informed sources, Apple's Vice President of Global Affairs, Nick Amman, has left Indonesia on Wednesday, but the remaining team members will continue to negotiate with local departments.
In October last year, the Indonesian government banned Apple from selling its iPhone 16 series models in the country, on the grounds that Apple failed to comply with Indonesia's localization production requirements for smart devices.
Subsequently, Apple proposed to invest 1 billion dollars in Indonesia, including establishing a factory to produce AirTags locally and funding local colleges to provide coding skills training for students.
Indonesian President Prabowo welcomed the proposal and instructed the cabinet last month to accept Apple's investment and end the ban. However, sources say that the Indonesian Minister of Industry, Agus Gumiwang Kartasasmita, decided at the last moment of negotiations to maintain the sales ban on Apple.
Kartasasmita stated that Apple needs to comply with Indonesia's regulatory system, which requires Apple to produce a part or components of the iPhone 16 in Indonesia.
Political risks have increased.
Prabowo approved the Indonesian government's acceptance of Apple's proposal in a previous meeting, despite Apple's commitment to produce other types of components in the factory it promises to invest in. Prabowo also urged the government to work harder to attract more foreign investments in the future.
Prabowo instructed his coordinating Minister of Economic Affairs Airlangga Hartarto to lead the Trade with Apple, unexpectedly interrupted by the Minister of Industry. Kartasasmita's technical team is currently responsible for negotiations with Apple, and he has always been seen as a highly controversial political figure.
Earlier last year, Kartasasmita implemented an import regulation that sparked much discussion, restricting the import of thousands of commodities from MacBooks to auto tires, leading to frequent complaints from overseas companies.
His disregard for Prabowo's indications, continuing the ban on the sale of iPhone 16, also reflects the unrest within Indonesia's new government. This represents that overseas companies will face significant political risks in the Indonesian market.
Critics point out that Indonesia's harsh demands for international companies to increase local manufacturing may backfire, preventing other companies from considering expanding their business in Indonesia.