Indonesia is on the verge of striking a significant deal with Apple Inc. that could potentially lift the ban on iPhone 16 sales in the country. The announcement, made by Indonesia’s Investment Minister Rosan Roeslani during an interview with Bloomberg Television on Tuesday (January 21), has raised hopes for a resolution to a contentious issue that has impacted Apple’s operations in the world’s fourth-most populous nation.
“Hopefully, within one or two weeks, this issue can be resolved,” Roeslani stated, speaking from the World Economic Forum in Davos, Switzerland.
While Apple has yet to comment on the matter, and the Indonesian government has remained silent, the potential agreement could have broad implications for the Southeast Asian country’s electronics market, its ambitions to boost local manufacturing, and Apple’s presence in a rapidly growing consumer base of nearly 280 million people.
The iPhone 16 sales ban stems from Indonesia’s strict regulations mandating that smartphones sold in the country must contain at least 40% locally-produced components. The policy is part of a broader government initiative aimed at fostering domestic manufacturing, attracting foreign investment, and reducing reliance on imported products.
Apple, which does not have manufacturing facilities in Indonesia, failed to meet these requirements when the iPhone 16 launched last year. The company’s inability to comply with local content rules led to a prohibition on the sale of its flagship product in one of Asia’s largest markets for mobile devices.
Since 2018, Apple has established several developer academies in Indonesia, which train local talent in app development and aim to support the country’s growing tech ecosystem. However, these efforts fell short of satisfying the 40% local content mandate, sparking tensions between the company and Indonesian regulators.
Minister Roeslani’s comments suggest that negotiations between Apple and the Indonesian government are nearing a breakthrough. Though details of the proposed agreement remain unclear, the deal is expected to involve a commitment from Apple to increase its local contributions—potentially through partnerships, investments in technology transfer, or new manufacturing initiatives.
Reports indicate that the Indonesian government is seeking more than just compliance with the local content requirement. Officials are pushing for sustainable investments that align with Indonesia’s broader economic goals, including job creation and technological innovation.
“This is not just about meeting a percentage threshold,” said an unnamed government official familiar with the negotiations. “It’s about building a long-term partnership that benefits both parties.”
Apple’s reluctance to build a manufacturing facility in Indonesia could be tied to the country’s challenging investment climate, including concerns about bureaucracy, infrastructure limitations, and regulatory unpredictability. However, the potential size of the market may ultimately outweigh these risks.
For Apple, Indonesia represents a significant growth opportunity. With a young, tech-savvy population and increasing smartphone penetration, the market offers considerable potential for expansion. The ban on iPhone 16 sales, however, has put Apple at a disadvantage against competitors such as Samsung and Chinese brands like Oppo, Vivo, and Xiaomi, which have established local production facilities to comply with Indonesian regulations.
The absence of the iPhone 16 on store shelves has also led to frustration among affluent Indonesian consumers who typically favor Apple’s premium devices. Many have turned to gray market imports to obtain the latest iPhone, a trend that undermines both Apple’s revenue and government tax collections.
For Indonesia, the deal represents an opportunity to assert its position as an attractive destination for global tech companies. By securing a commitment from one of the world’s most valuable corporations, Indonesia could bolster its efforts to integrate into global supply chains and advance its industrial development goals. Success in negotiations with Apple could also set a precedent for other multinational corporations seeking to operate in the country.
Indonesia’s push for local manufacturing is part of a broader strategy to leverage its domestic market to attract investment. The government’s emphasis on local content requirements aligns with its goal of fostering industrial growth, creating jobs, and reducing reliance on imports. However, this strategy has also drawn criticism for potentially deterring foreign investment and innovation.
Critics argue that imposing rigid local content rules on high-tech industries could backfire by discouraging global players from entering the market. Such regulations, they contend, may limit consumer choice and increase prices for advanced technologies.
“Finding the right balance is crucial,” said Bhima Yudhistira, an economist at Indonesia’s Center for Economic and Law Studies. “While it’s important to promote local industry, overly stringent requirements could alienate key investors and slow down the adoption of cutting-edge technologies.”
The anticipated deal with Apple could offer a model for how Indonesia can harmonize its domestic priorities with the realities of global business operations. If structured effectively, the agreement could pave the way for greater collaboration between the government and multinational companies.
Despite the current impasse, Apple’s presence in Indonesia has not been entirely absent. Since 2018, the company has operated several Apple Developer Academies in cities such as Jakarta, Surabaya, and Batam. These academies, which provide training in app development and coding, are part of Apple’s broader commitment to supporting local talent and fostering innovation.
The academies have been widely praised for their role in equipping Indonesian developers with skills to compete in the global digital economy. However, critics argue that these initiatives alone are insufficient to satisfy the government’s demands for tangible, locally-produced hardware components.
“Apple’s investment in education is commendable,” said a technology analyst in Jakarta. “But what the government really wants is for Apple to contribute to the manufacturing ecosystem—whether that’s through direct production, partnerships, or supply chain integration.”
As negotiations between Apple and Indonesia move toward a potential resolution, both sides face challenges in finalizing a deal that meets their respective objectives. For Apple, the primary challenge lies in navigating Indonesia’s regulatory landscape and finding ways to align its global operations with local requirements. For Indonesia, the challenge is to secure meaningful investments without alienating one of the world’s most influential technology companies.
Observers are optimistic that a resolution will be reached soon, given the high stakes for both parties. A successful deal could reopen the Indonesian market to Apple’s flagship products while demonstrating the country’s ability to work constructively with global corporations.
In the long term, the outcome of these negotiations could have ripple effects across the region. As Southeast Asia continues to emerge as a key growth market for technology companies, the strategies adopted by Indonesia and Apple could serve as a blueprint for other countries grappling with similar challenges.
