Apple Reaches $1 Billion Deal to Lift Ban on iPhone 16 in Indonesia [Report]

Apple has reached a deal with Indonesia to end a five-month standoff that blocked iPhone 16 sales in the country, according to new report from Bloomberg. The agreement, which includes a $1 billion investment commitment from the U.S. tech giant, resolves a dispute over local manufacturing rules and is expected to be formalized this week.

The Indonesian Ministry of Industry plans to sign a memorandum of agreement with Apple soon, people close to the negotiations said. Once the agreement is signed, a press briefing will follow, and the ministry aims to issue a sales permit for the iPhone 16 as quickly as possible, the sources added. When asked for comment, Apple and the ministry did not respond.

The conflict began in October when Indonesia denied a sales permit for the iPhone 16, arguing that Apple failed to meet domestic manufacturing requirements for smartphones and tablets. Initially, Apple proposed a $10 million investment to lift the ban, which was declined. The company then offered $100 million, which was also rejected. After Apple proposed a $1 billion investment, President Prabowo Subianto instructed his administration to accept it. Still, the Ministry of Industry held firm last month, pushing for better terms—an unexpected move that prolonged the impasse.


Under the new deal, Apple will not only invest $1 billion but also train Indonesians in research and development tied to its products. The goal is to enable locals to create their own software and designs, according to the sources. This move aligns with Indonesia's push for Apple to establish R&D facilities in the country, they said. The training will occur through initiatives separate from Apple's existing academies, one source noted. However, Apple has no immediate plans to manufacture iPhones in Indonesia, the people confirmed.

While the agreement signals progress, there's a caveat: Indonesia has reversed course on similar decisions before, and the deal could still unravel. Talks had been moving forward positively despite January's last-minute setback, the sources said. Last week, Industry Minister Agus Gumiwang Kartasasmita announced that Apple settled a $10 million debt for noncompliance with local rules from 2020 to 2023, clearing another hurdle.

The resolution marks a victory for Indonesia, which leveraged its stance to secure greater investment from a global tech leader. Previously, Apple's investment in the country totaled just $95 million, according to the government. The $1 billion package includes a plant in Batam to produce AirTags—expected to handle 20% of global output with supplier Luxshare Precision Industry Co.—and another facility in Bandung for additional accessories. Funds will also support Apple academies, which teach skills like coding.

For Apple, the deal unlocks Indonesia's 278 million-strong market, where over half the population is under 44 and tech-savvy—a critical opportunity as sales lag in China. Though not among Indonesia's top smartphone brands, Apple sees clear potential in the region. For President Prabowo, the outcome bolsters his administration's image amid recent domestic criticism over policy shifts and spending cuts.


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