Apple breaks through Indonesia’s trade wall – and iPhone goes on sale

At a cost of many millions, Apple seems to have resolved problems it was having in Indonesia, where the iPhone 16 series will now go on sale from April 11, following a sales ban.

To convince the government in Jakarta to permit it to sell smartphones in the nation Apple engaged in some stiff diplomacy, including making a commitment to deliver a $300 million investment plan.

Chasing new business

What makes it worth that investment is Indonesia’s massive population of 280 million people – the problem was that protectionist local laws meant Apple was required to make more iPhone components in Indonesia in order to sell the product there.

Apple shipped around 2.7 million iPhones in Indonesia last year, up from 0.3 million in 2016, according to data shared by IDC. iPhone sales were blocked in October 2024.

Apple’s commitments include investment in a local R&D and training center and an AirTag manufacturing plant on Batam island, which will be run by Luxshare Precision Industry. Reports claim Apple intends making one-in-five of its Airtags there. A second factory is also planned, as are a series of Apple academies.

Made in India?

Interestingly, Apple will not make iPhones in Indonesia, which is unique in that other manufacturers have been forced to do so. Instead, it appears the company has managed to find common ground with the local government in which it has been able to achieve market access through an imaginative range of other concessions.

This kind of relationship building is super important to Apple as it attempts to build business in emerging economies even as its more established markets become increasingly complex and/or moribund. The underlying message is that Apple continues to build a bulwark to protect its business against growing international tensions.

The iOS economy

Apple CEO, Tim Cook, visited Indonesia last year, meeting President Joko Widodo to discuss potential investments in the nation. Cook even spoke at a news conference, during which he confirmed discussions about manufacturing and characterized the investment opportunity there as “endless.”

Apple announced its fourth developer academy in Bali during his visit “We’ve seen many times over that a line of code can change the world — and in Indonesia, we’re investing in the creativity and skills of people determined to prove it,” Cook said.

“We’re excited by the growing developer community in Indonesia, and we look forward to investing in the success of even more coders with our fourth academy in the country.”

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