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

There is apparently still 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 Economy is expecting more money from Apple, particularly for a deeper local supply chain, in order to reconsider its decision. A tenfold increase in investment in the local economy of the world's fourth largest country is therefore not enough.

No approval for the new iPhones

For reasons that are unclear – – , Apple did not initially invest the full amount in the country as promised by CEO Tim Cook. It was ultimately 10 million US dollars too little. Economics Minister Agus Gumiwang Kartasasmita reacted sharply and declared the iPhone 16 illegal in his country and did not issue the devices with an IMEI. "We, the Ministry of Industry, cannot issue these permits for the iPhone 16 because Apple has not yet fulfilled its obligations," he said in October.

Apple, which has not yet publicly commented on the incident, reacted belatedly and announced that it would now increase the sum to 100 million dollars. However, this is not enough for the government. As the Antara news agency wrote at the weekend, Apple is expected to invest"over 100 million dollars" in the country. From the government's perspective, they want the sum to be larger, a spokesperson told the medium.

Carrot and stick

The main aim is to strengthen the local manufacturing industry and ensure that Indonesia becomes "part of Apple's global supply chain". The presence of suppliers would create more jobs. Indonesia is not yet in a position to produce the semiconductors required by Apple. "But if Apple needs them, components could come from local suppliers," said the spokesperson for the Ministry of Economic Affairs. It is about a "multiplier effect". Apple is also being invited to carry out research and development in the country – as part of its "Industry 4.0" initiative, which also involves artificial intelligence. There are apparently already plans to produce parts of the AirPods Max – specifically the mesh fabric – in Indonesia in West Java.

The spokesperson did not provide any information on possible subsidies – but they are conceivable. Nevertheless, Apple is confronted with a difficult situation: It is diplomatically thin ice for the company, which is otherwise courted by many governments. On Friday, it was also reported that the Indonesian government will block IMEI numbers of foreign iPhone 16 models as soon as they are put into operation in the country. In the worst case scenario, this could also affect tourists entering the country with their new iPhone. As many as 11,000 devices are said to have been registered by November 10. The aim is to prevent a gray market in the devices. Checks are also planned at the border to determine whether a device is really private or intended for sale.

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