After months of dispute, Apple and the Indonesian government finally reached a settlement to lift the iPhone 16 sales ban in the Southeast Asian country.
The iPhone 16 sales were banned in Indonesia in October last year after the country's Ministry for Industry accused Apple of failing to fulfill its investment commitments. To lift the ban, Apple initially offered a $10 million investment plan, and when it was rejected, the tech firm raised the bail to $109 million. The second offer was also rejected by the Indonesian government.
Bloomberg now reports that Apple has agreed to invest $1 billion in the country to lift the ban. Apple and the Ministry for Industry will sign a memorandum of agreement this week as the government is pledged to lift the iPhone 16 sales ban "as soon as possible."
The Indonesian government has long demanded Apple to establish an R&D facility in the country. In addition to investing $1 billion in Indonesia, Apple is also committed to training and involving locals in research and development so that local Indonesians can develop similar software and designs.
However, Apple's commitment to the government doesn't end there. The iPhone maker will also build an AirTag manufacturing plant in Indonesia's Batam island through partnering with Luxshare Precision Industry. The plant is expected to account for 20 percent of AirTag's global production.
Moreover, Apple will build a facility in Bandung to produce various accessories. The outlet says Apple has yet no plan to move iPhone production to Indonesia.
A $1 billion investment commitment seems modest compared to Apple's recent pledge to invest $500 billion in the US over the next four years. However, losing the Indonesian market, which boasts a population of 278 million people, could have a huge impact on Apple's revenue.
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