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Delving into Apple’s Investment Talks with Joko Widodo

Updated: May 5



The meeting between Apple CEO Tim Cook and President Joko Widodo of Indonesia on April 17th, 2024, marked a pivotal moment at the nexus of technology and economic progress. Cook’s visit to Jakarta sparked anticipation, signaling readiness for collaboration as talks explored potential investments in Indonesia’s growing economy. President Widodo’s strategic vision highlighted the transformative power of utilizing Apple’s expertise to bolster the nation’s industries. Key discussions centered on the possibility of Apple establishing a manufacturing facility in Indonesia, poised to catalyze domestic sectors and elevate the country’s global tech presence. Amid geopolitical shifts and technological advancements, the meeting underscored the importance of seizing mutual growth opportunities. The partnership between Apple and Indonesia reflects a shared commitment to innovation and inclusivity, with both leaders emphasizing technology’s role in societal advancement. Dialogue resonated with shared values, fostering determination towards harnessing technology for positive change. As the meeting concluded, Cook and President Widodo departed with a renewed dedication to translating aspirations into tangible results. Their collaboration promises to reshape Indonesia’s socio-economic landscape and inspire similar efforts worldwide, driving inclusive growth and sustainable development. This collaboration sets a precedent for future partnerships between technology giants and emerging economies, paving the way for mutually beneficial ventures that prioritize innovation and societal well-being. This particular partnership by Apple and Indonesia are considered crucial as Apple sees Indonesia’s market significance.


Central to the dialogue was a substantive discussion on Indonesia's local content requirement regulations, particularly about mobile phones, computers, and tablets. Minister of Industry Agus Gumiwang highlighted the mandated Threshold of Domestic Component of 35% for these electronic devices. Underpinning this regulation, promulgated through the Ministry of Communication and Information Technology in 2021, is the imperative of fostering indigenous technological capabilities and nurturing a vibrant local industry ecosystem. Minister Agus Gumiwang further provided statistical insights, revealing that in the preceding year of 2023, Indonesia witnessed the production of approximately 49-50 million mobile phones, with a negligible import volume of merely 2.79 million units. Remarkably, of this import figure, a staggering 85% comprised products emanating from Apple, thus accentuating the profound market presence and significance of the tech titan within Indonesia's digital landscape. The discourse underscored the imperative of enhancing local value addition and indigenous innovation to align with regulatory imperatives while fostering a conducive environment for sustainable technological development and economic growth. Furthermore, Minister Agus Gumiwang emphasized the importance of adherence to the local content requirement to stimulate domestic production, create employment opportunities, and catalyze technological innovation within Indonesia's burgeoning tech ecosystem. The notion requires strategic collaboration between industry stakeholders and government bodies to ensure effective implementation of local content requirements, emphasizing a coordinated approach as pivotal for realizing Indonesia's aspirations of becoming a regional hub for technology and innovation.


Applying technology and educational mastery in Indonesia by Apple attests that one strategy can be composed from investment and empowerment of education at the same time. As President Joko Widodo spoke, Tim Cook, the CEO, stunned the audience with a revelation: Apple would be investing as much as Rp 1.6 trillion in Indonesia. There is a crucial link to this investment to do with the submission to the TKDN (Tingkat Kemudahan Dalam Neuron), which is a must-follow policy of the government of Indonesia and it relates to handphones, computer, and tablets (HKT) sharing among local citizens, which is 35% of the production. The industry minister, Raden Agus Gumiwang said that in 2023 and out of approximately 49-50 million of HPs that were produced domestically, the number of imported products was 85% or 2.79 million of them were Apple products. To realize the priority of fostering value addition among native peoples, Apple employs a multi-faceted action plan, in which educational infrastructures are the most important. Apple Developer Academies in every major city in Java, a province in Indonesia where this program is applied, can be seen as this program's key in developing local software coding skills. Along with the opening of Apple Academy in Bali at the end of this year, customers located in Batam, Surabaya and Tangsel will also be able to get access to this American multinational technology company’s state-of-art technology. Mr. Agus Gumiwang's planned expansion of the Academy's area of service to the eastern areas of Makassar and IKN show that working together is the most crucial thing between Apple and the government of Indonesia to ensure the growth of the Academy. Along with the regulations, such endeavors exemplifies Apple’s dedication in this field and also provides the working force with essential skills, serving as the basis for sustainable development and communities prosperity in Indonesia at the same time.


Sources:

Bloomberg

CNBC

Reuters


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