Negotiating with one of the largest companies in the world doesn’t sound easy, but that’s precisely what Indonesia has been doing for the past few weeks with iPhone maker Apple. The backstory here is that after the country required smartphones which are sold domestically to be made of at least 40% locally manufactured parts, Indonesia banned iPhone 16 sales. In November 2024, authorities even confiscated and destroyed recent iPhone models, as shown in the picture above.
Now, Reuters reports that Apple plans to spend $1 billion on its first manufacturing plant in Indonesia. The factory will produce smartphone components and other parts for Apple products.
While the move follows Indonesia’s crackdown on foreign production, it fits a trend as over the past few years Apple has diversified its supply chain to reduce reliance on China. For instance, the iPhone 16 is currently manufactured in Brazil and India, as well as China. Many AirPods models are also assembled in Vietnam.
