(Bloomberg) — Apple Inc. has signed an agreement with Indonesia to invest in the country, paving the way for sales of the iPhone 16 to resume in Southeast Asia’s largest nation.
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The agreement was announced by Minister for Industry Agus Gumiwang Kartasasmita in a media briefing in Jakarta on Wednesday, as reported by Bloomberg Technoz. The ministry will begin a process to issue Apple with a permit allowing it to sell its latest smartphone, news outlet Kompas reported. Bloomberg News reported earlier the parties were poised to reach a deal.
The company is “excited to expand investments across Indonesia and can’t wait to bring all of Apple’s innovative products, including the iPhone 16 family, with the all new iPhone 16e, to our customers here,” an Apple spokesperson told Bloomberg News.
The pact is set to end a five-month tussle that started in October after Indonesia refused to issue a sale permit to Apple, citing its failure to comply with domestic manufacturing requirements for smartphones and tablets. Apple then pledged to invest $1 billion in Indonesia, an offer President Prabowo Subianto directed his ministers to accept. However, the Ministry of Industry last month unexpectedly upheld the ban as it sought better terms.
The deal is a win for Indonesia, with its hardball tactics paying off in getting a major foreign company to invest more to develop its goods in the country and boost local manufacturing, instead of merely using the nation as a sales hub. The government had previously said that Apple had invested only about $95 million in Indonesia.
The agreement also comes at an opportune time for Prabowo. The optics of a US tech giant yielding to his administration could be used to boost his domestic standing, which has taken a hit following multiple policy U-turns that have generated confusion. On top of that, his plan for sweeping spending cuts that threatened jobs and scholarships triggered days of protests last week.
For Apple, the deal gives it access to Indonesia’s massive consumer market at a time when sales in China have slowed. Though Apple ranks outside the top five smartphone brands in Indonesia, the country’s population of 278 million people — more than half of whom are under the age of 44 and tech-savvy — is too good an opportunity to miss.
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