The government and Apple Inc. on Tuesday, January 7, 2025 held the first negotiations on its investment plan in Indonesia as part of the mechanism to pass the sale of its latest iPhone 16 smartphones, emphasizing on two additional points and four main objectives.
Minister of Industry Agus Gumiwang Kartasasmita emphasized four main issues that underlie the negotiations, namely Apple’s investment in other countries, investment by other gadget manufacturers domestically, added value and state income, and employment absorption.
The main objective in negotiations with Apple Inc. is job creation, through efforts to establish an iPhone factory in the country. In the negotiations there are four objectives, with job creation considered to be the primary one.
“We will prioritize four principles in the negotiations, but the most importance is job creation. Key is how we can direct Apple to build a factory in Indonesia,” Agus said on Tuesday, January 7, 2025.
He admitted that he could not guarantee how long the negotiations would last before reaching an agreement, considering that a long negotiation time would ultimately only harm Apple.
Two additional points
In addition, Agus emphasized two additional points in his response to the investment proposal submitted by Apple Inc., such as investment debt and the threat of sanctions for allegedly violating previous investment provisions.
Agus cited that the first point includes the fulfillment of investment commitment debt worth US$10 million (Rp300 billion) from a total investment commitment of Rp1.7 trillion in 2020-2023.
The government, however, has not set a deadline for waiting for Apple’s response to the proposal. Agus estimates that investment negotiations for the Domestic Component Level (TKDN) certification will take at least a month.
Meanwhile, the second additional point is about the establishment of sanctions for violations committed by Apple. Agus suspects that Apple’s innovation investment in 2020-2023 has violated the Minister of Industry Regulation (Permenperin) No. 29/2017.
It is stipulated in the Permenperin No. 29/2017 that an innovation center is defined as a facility and infrastructure for education, training, research and development of innovation in the field of information and communication technology.
However, Agus suspects that the three Apple Academies that are a form of Apple investment in 2020-2023 only provide education and training. Agus plans to send a team to audit three Apple Academies that have been operating, namely in Tangerang, Banten; Surabaya, East Java; and Batam, Riau Islands. The three facilities have swallowed up an investment of Rp1.48 trillion.
He emphasized that Permenperin No. 29/2017 stipulates two sanctions for investors who violate investment provisions, namely revocation of TKDN certificates and additional investment. Therefore, Agus said the investment value proposed by the government in its counter proposal to Apple had taken into account investment debt and investment sanctions.
