iPhone 16 Ban To End In Indonesia For $1B+ Compensation

Select Language:

After months of restrictions, it appears that the ban on the iPhone 16 in Indonesia will soon be lifted, following Apple’s reported agreement to significantly increase its investment in the Southeast Asian nation. The impending release of the iPhone 16e may have heightened the urgency for Apple to finalize this deal.

Sources indicate that Apple is preparing to sign a deal with Indonesian authorities later this week, with expectations that the ban will be officially revoked shortly after.

The Story Behind the iPhone 16 Ban

Initially, Apple made a $109 million investment in Indonesia by establishing a developer academy and contributing an additional $10 million toward manufacturing. However, the government claimed that Apple fell short, having spent merely $95 million, leading to a prohibition on the sale and utilization of the iPhone 16 models.

Given Indonesia’s sizeable and economically advancing population of about 280 million, this posed a significant challenge for Apple. In response, the tech giant proposed a dramatic increase in its manufacturing expenditure—raising it from $10 million to $100 million.

The Indonesian authorities anticipated even more investment, although a specific figure wasn’t immediately provided. Eventually, they indicated that they expected another ten-fold expansion, amounting to a staggering $1 billion.

Even after Apple agreed to transition its AirTag production to Indonesia, the government maintained its stance, insisting that components for the iPhone also be manufactured locally.

Apple Allegedly Committed to Investing Over $1 Billion

As reported by Bloomberg, a consensus has reportedly been reached, set to be formalized later this week.

The Ministry of Industry, responsible for enforcing the ban, is expected to sign a memorandum of understanding with Apple in the coming days, according to anonymous sources familiar with the discussions. A press conference is planned for the same time, during which the ministry aims to unveil a permit that will allow the sale of iPhone 16 devices without delay.

Beyond the $1 billion commitment, Apple is also set to focus on training local talent in research and development related to its products, allowing them to create similar software and develop their unique offerings. This initiative is part of Apple’s response to the Indonesian government’s push for the establishment of R&D facilities within its borders.

This investment in innovation will occur through new programs distinct from the existing Apple academies, according to insiders.