Finance News on November 5th (Editor Huang Junzhi) According to informed sources, Apple Inc. plans to invest nearly $10 million in Indonesia to expand its product production, in order to seek lifting the sales ban on its latest iPhone in Indonesia.

The informant said that this plan will involve Apple cooperating with its suppliers to invest in a factory in the southeast of Jakarta, in Bandung. He stated that the factory will produce accessories and parts for Apple devices. The Indonesian Ministry of Commerce is reviewing this proposal and is expected to make a decision soon. This proposal is not yet final and may be subject to changes.

Clearly, Apple has compromised this time with Indonesia's 'blockade'. The Indonesian government previously announced a ban on the sale of the latest iPhone 16 in the country, as Apple failed to fulfill its investment commitments in Indonesia. The Indonesian government required Apple's subsidiary in Indonesia to achieve a 40% localization rate, which it failed to meet.

It is understood that Apple does not have any independent factories in Indonesia, like most multinational companies, Apple collaborates with local suppliers to produce components or finished products.

Some analysts point out that an investment close to $10 million is a relatively small cost for Apple because it can more freely access around 0.278 billion consumers in Indonesia. Over half of these consumers are under 44 years old and are fond of technology products.

Indonesia's new President Prabowo Subianto's government is attempting to protect domestic industries by pressuring multinational companies to boost local manufacturing. The ban on iPhone 16 is the latest example in this regard. Due to the lack of investment, this Southeast Asian country has also banned the sale of Alphabet Inc.'s Google Pixel phones.

While Indonesia may see Apple's additional investment as a victory, its hardline approach may hinder other companies from expanding their business or attracting 'fresh blood'—new companies moving in. This could also jeopardize Prabowo's goal of attracting foreign investment to grow the economy and fund policy expenditures.

In fact, India has previously exhibited such casual trade policies. Earlier this year, the Indian government imposed import restrictions on thousands of products, from Macbook to tires to chemicals, in order to force foreign companies to expand production scale. However, this action has angered the business community, including companies with a long history in manufacturing such as LG Electronics.

It is also worth mentioning that despite India's repeated calls for international companies to boost manufacturing, its domestic industry is weakening. Last year, the proportion of manufacturing in the country's Gross Domestic Product (GDP) declined from 21.1% in 2014 to 18.7%.