Dispute with Apple over iPhone 16: $100 million is not enough for Indonesia

There still clearly appears to be no movement in the dispute between Apple and the Indonesian government over the approval of the iPhone 16 series. According to local media, the country’s Ministry of Economic Affairs is hoping for more funding from Apple to reconsider its decision, especially for a deeper local supply chain. Therefore a tenfold increase in investment in the local economy of the world’s fourth largest country is not enough.

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No approval for new iPhones

It is unclear for what reasons Apple did not invest the entire amount in the country as initially promised by CEO Tim Cook. Ultimately, it was $10 million too little. Economy Minister Agus Gumiwang Kartasasmita reacted sharply and declared the iPhone 16 illegal in his country and did not give IMEI to the devices. “We, the Industry Ministry, cannot issue these approvals for the iPhone 16 because Apple has not yet realized its commitments,” he said in October.

Apple, which has yet to comment publicly on the incident, responded late and announced it would now increase the amount to $100 million. However, this is not enough for the government. As Antara news agency writes over the weekend, Apple hopes to raise “more than $100 million” invest in the countryA spokesperson told the medium that from the government’s point of view, they want the amount to be larger.

Dispute with Apple over iPhone 16: $100 million is not enough for Indonesia

carrot and stick

This is specifically about strengthening the local manufacturing sector and ensuring that Indonesia becomes “part of Apple’s global supply chain.” Presence of suppliers ensures more jobs. Indonesia is not yet in a position to produce the semiconductors needed by Apple. “But if Apple needs them, the components can come from local suppliers,” a Ministry of Economic Affairs spokesman said. It’s about the “multiplier effect”. Apple is also being invited to conduct research and development in the country as part of its “Industry 4.0” initiative, which also includes artificial intelligence. There are apparently already plans to produce some parts of the AirPods Max — specifically the mesh fabric — in West Java, Indonesia.

The spokesperson did not provide any details about possible subsidies – but they are conceivable. Still, Apple faces a difficult situation: Diplomatically, it’s on ice for the company, which is otherwise accepted by many governments. It was also said on Friday that the Indonesian government will block the IMEI numbers of foreign iPhone 16 models once they are rolled out in the country. In the worst case, it could also impact tourists Sign in with your new iPhoneAt least 11,000 devices were said to have been registered by November 10. Its purpose is to prevent devices from becoming gray market. Border checks are also planned to determine whether any equipment is truly private or for sale.

(B.Sc.)