Indonesia has upheld its ban on the sale of Apple’s iPhone 16, stating that Apple’s $1 billion investment plan, which includes a factory for producing AirTags, does not meet the country’s domestic content requirements.
The Industry Minister, Agus Gumiwang Kartasasmita, said on Wed that the local production of only AirTags, an accessory, does not fulfill the obligation to produce smartphones or their components onshore.
“As of this afternoon, the government does not have a basis for issuing the local content certificates” that Apple needs to sell its flagship device in Indonesia, he said. “Apple needs to negotiate with us so that we can issue a certificate.”
Indonesia’s decision to block iPhone 16 sales in October is part of its strategy to push Apple to invest more in the country.
The ongoing delays in the resumption of sales are affecting Apple’s potential revenue from Indonesia’s large market of around 280 million consumers.
This puts Apple in competition with rivals like Samsung Electronics, which are seeking a stronger foothold in the Southeast Asian economy.
Kartasasmita warned that Apple could face sanctions for failing to comply with Indonesia’s local investment regulations, although he emphasized that this would be a last resort for the government.
“We will look for other ways or options,” he said, adding that the government has already sent a counterproposal to Apple.
An Apple spokesperson in Indonesia declined to provide a comment on the issue.
Apple plans to build a factory by early 2026 to produce AirTags, a device that helps users track items like luggage and pets, according to Roeslani. Company executives are currently in Jakarta to negotiate the investment proposal with the government.
Rivals like Samsung and Xiaomi have already established factories in Indonesia to meet the domestic content regulations introduced in 2017.
Other methods to increase local content include sourcing materials, hiring local workers, developing apps, and investing in developer academies within the country.
“There’s no deadline for compliance,” Kartasasmita said. “If Apple wants to sell the iPhone 16, and especially if they plan to launch the iPhone 17, the decision is entirely up to them.”
