Indonesia Strikes Deal to Lift iPhone 16 Sales Ban

Indonesia has reached a pivotal agreement with Apple, potentially lifting the ban on iPhone 16 sales in Southeast Asia’s largest economy.

The deal, reported by local media on Wednesday, involves Apple investing in the country to meet local manufacturing regulations.

The government had imposed the sales ban in October after Apple failed to comply with requirements mandating that 40% of smartphone components be locally sourced.

However, Industry Minister Agus Gumiwang Kartasasmita confirmed that a Memorandum of Understanding (MoU) had been signed virtually between Apple and Indonesian officials.

As part of the agreement, Apple will establish two key facilities: an accessory production site in Bandung, West Java, and a $150 million AirTag manufacturing facility in Batam, developed in partnership with local suppliers, Bloomberg News reported.

The MoU stipulates conditions under which the ban on iPhone 16 sales can be revoked. Following the signing, the process of obtaining a local content certification for iPhone 16 could commence, according to Indonesian news outlet Kompas.

A government source confirmed to AFP that terms for lifting the ban had been settled, though further details were not disclosed. Apple, along with Indonesia’s Industry and Investment Ministries, has yet to issue an official response.

This agreement follows Jakarta’s rejection of Apple’s initial $100 million investment proposal in November, citing unfair terms. The stalemate pushed Apple to increase its commitment, later proposing a $1 billion investment to establish an AirTag factory.

Despite the ban, Indonesia permitted individuals to bring iPhone 16 devices into the country for personal use, provided they were not sold commercially.

The government has also banned Google Pixel sales for failing to meet the same local content regulations.

Apple CEO Tim Cook visited Indonesia last year as part of efforts to expand investment and reduce reliance on Chinese supply chains.