Why Apple is not allowed to sell iPhone 16 models in Indonesia
Indonesia has Apple Inc. prevented from selling its latest iPhones in Southeast Asia’s largest economy because the company has not yet met local investment requirements. The iPhone 16, launched in September, cannot be marketed domestically because local unit PT Apple Indonesia does not meet the country’s 40% domestic content requirements for smartphones and tablets, the Industry Ministry said in a statement on October 25. can still be sold in Indonesia.
That’s an obstacle for Apple, which has enjoyed healthy initial sales of its flagship product in other Asian markets such as China. Although Apple is outside the top six smartphone brands in Indonesia, it is a potential growth market with a young, increasingly tech-savvy population. The $1 trillion economy has more than 350 million active cellphones — far more than the country’s 270 million residents, according to government data.
The Industry Ministry said earlier in October that Apple has invested only 1.5 trillion rupiah ($95 million) in Indonesia, short of its 1.7 trillion rupiah commitment. Apple built four developer academies in the country rather than setting up a local production facility, although CEO Tim Cook said in April that the company was exploring the feasibility of this.
Apple representatives did not immediately respond to an emailed request for comment outside regular U.S. business hours.
Rival phone makers such as Samsung Electronics Co. and Xiaomi Corp. have set up factories in Indonesia to comply with domestic content regulations introduced in 2017. Other ways to boost local content include sourcing materials or hiring employees in-country.
Indonesia has a long track record of using trade restrictions to encourage foreign companies to produce more of their goods domestically, albeit with mixed success.
The government has tightened import rules on a wide range of products this year, leading to shortages of items such as laptops and car tires and a build-up at ports. However, the long-standing ban on the export of mineral ores such as nickel has led to the rapid development of the battery sector.
About 9,000 iPhone 16 units have entered Indonesia so far, either carried by hand by passengers and crew or delivered by post, the industry ministry said. These are only allowed for personal use and cannot be traded, the report said. Even this route may not be easy for interested iPhone 16 buyers. Since 2020, Indonesia has required all phones purchased abroad to be registered with the government and attract a high tax.
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