Indonesian state media reported that the government of that country currently expects Apple to increase local investment.
In this case, the specified wording implies a rise of the financial injection from the mentioned technology giant, based in Cupertino, California, into Indonesia. It is worth noting that Apple’s planned investment in the mentioned country amounts to $100 million.
It is also worth noting separately that the technology giant is currently trying to obtain permission from the Indonesian authorities to carry out activities to sell its newest smartphones. The latest model of the corresponding Apple device is not available in the market of this country. The reason for this state of affairs is the Indonesian rule providing for 40% of domestic content requirements for smartphones and tablets. Failure to comply with the mentioned rule means that it is impossible to launch sales on the local market. For Apple, the Indonesian regulations proved to be a limiting factor in the context of product sales opportunities in this country.
Jakarta has decided to impose the mentioned requirements under the pretext of protecting local industry and jobs. Local officials said Apple would gain greater access to the Indonesian market if it increased its investment and commitments to the country’s economy.
State media reported that representatives of the Indonesian Ministry of Industry met with company representatives this week. According to preliminary information, within the framework of the mentioned meeting, the investments proposed by the technology giant for $100 million in this country were discussed. Apple intends to make the appropriate financial injections within two years. The media reported that these investments are aimed at a research and development center program and professional development academy in Indonesia. The technology giant also intends to launch the production of accessories in this country starting next year.
The $100 million financial injection significantly exceeds Apple’s initial economic intentions for Indonesia. At the same time, the government of this country is striving to make the deal with the technology giant more voluminous, including in the context of the economic aspect. Local industry ministry spokesperson Febri Hendri Antoni Arif this week confirmed to reporters Jakarta’s desire for more large-scale investments from Apple. According to him, a larger financial injection would contribute to the development of Indonesia’s manufacturing sector. He also noted that the local industry is able to support the making of Apple products such as chargers and accessories.
The company has not yet commented on the mentioned information.
Le Xuan Chiew, a Canalys analyst focusing on Apple strategy research, said that Indonesia is a small market for the technology giant, but at the same time, this country, ranking fourth in the world in terms of population, offers growth opportunities. According to the expert, the local young, tech-savvy population with increasing digital literacy is in line with the company’s strategy to expand global sales. Le Xuan Chiew also stated that Indonesia has the potential for manufacturing and assembly, which supports the technology giant’s efforts to diversify its supply chain.
Moreover, the expert noted that success in the mentioned country’s market requires a long-term approach. According to Le Xuan Chiew, Apple’s investment proposal demonstrates the company’s commitment to comply with local regulations and paves the way for future growth.
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