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January 3, 2025 | 05:07 pm
TEMPO.CO, Jakarta - The Indonesian Ministry of Industry has outlined conditions for Apple Inc. to proceed with its planned investment in Indonesia. Following a period of stalled negotiations, the Ministry and Apple are set to engage in formal discussions on January 7 and 8 to finalize the investment plan.
“Apple must fulfill its debt commitment of US$10 million in the 2020-2023 investment cycle,” said Febri Hendri Antoni Arif, a spokesperson for the Ministry of Industry.
Despite Apple submitting a commitment proposal, the Ministry is awaiting the actual repayment of the debt, equivalent to Rp158 billion. This debt stems from Apple's previous investment in establishing a production facility in Indonesia between 2020 and 2023.
The other condition for Apple's continued investment is an increase in the Domestic Component Level (TKDN) from the current 35% to 40%. The Ministry has actively coordinated with Indonesian manufacturers of mobile phones, handheld computers, and tablets (HKT) to support this TKDN increase. He believes that this measure aims to reduce Indonesia's reliance on imported HKT products.
Furthermore, Febri explained that the Ministry has prepared two investment schemes. The first scheme encourages Apple to establish a manufacturing plant within Indonesia with facilitation provided by the Ministry of Investment and Downstream or the Investment Coordinating Board.
“The government encourages Apple to opt for the first scheme, namely investment in production facilities or factories,” said Febri.
Meanwhile, the second scheme is the innovation investment scheme, requiring the submission of innovative proposals every three years. If Apple prefers the second scheme, the Ministry of Industry will provide necessary technocratic calculations to facilitate the issuance of distribution permits for Apple products, including iPhone 16.
Throughout the negotiation process, the Ministry of Industry will prioritize national interests, emphasizing the development of domestic manufacturing within Indonesia. Four key principles will guide the Ministry's evaluation of Apple's investment proposal: Apple's investment activities in other countries, investments by HKT producers other than Apple in Indonesia, the generation of added value and income for the Indonesian economy, and the creation of employment opportunities within Indonesia.
The Ministry of Industry has confirmed that upcoming negotiations with Apple's top executives following the stalled discourse on Apple's investment in Indonesia. Apple had initially proposed an investment of US$100 million or approximately Rp1.61 trillion. However, Minister of Investment/Head of BKPM Rosan Roeslani urged Apple to significantly increase its commitment to US$1 billion or approximately Rp16.14 trillion.
Han Revanda contributed to the writing of this article.
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