Apple Pays Off $10 Million Debt to Indonesia, Minister Confirms
Businessicy – Minister of Industry Agus Gumiwang Kartasasmita confirmed that Apple has officially settled its $10 million debt to the Indonesian government. This payment marks the completion of the company’s investment commitment required to maintain its domestic component level certificate (TKDN) for the 2020-2023 period.
Kartasasmita announced in Jakarta on Wednesday that the government has officially received the payment, confirming that Apple has fully settled its debt. Consequently, the Ministry of Industry clarified that Apple’s investments had not fully met the compliance standards set by Minister of Industry Regulation No. 29 of 2017, which governs the eligibility for marketing its products in Indonesia. However, after acknowledging the outstanding amount, Apple fulfilled the remaining commitment, which was originally due in June 2023.
Indonesia’s regulations require foreign tech companies to meet specific investment obligations to maintain their TKDN certification, which allows them to sell products in the country. Failure to comply could lead to additional capital requirements, the suspension of TKDN certificates, or even a ban on product sales.
Apple’s settlement of the outstanding $10 million not only prevents potential sanctions but also ensures uninterrupted operations in Indonesia. Now that the payment has been completed, Apple can continue offering its devices in the Indonesian market without facing regulatory roadblocks. Furthermore, the Ministry of Industry emphasized that compliance plays a crucial role in fostering long-term investment and sustaining technological growth in the country.
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The Ministry of Industry opted for the lightest sanction in Apple’s case by requiring an additional investment capital scheme for the 2024-2026 period. The ministry communicated this decision to Apple during negotiations as part of its initial counter-proposal. Instead of imposing severe penalties like suspending or revoking Apple’s TKDN certification, Indonesia secured a long-term investment commitment from the tech giant.
To enhance transparency in Apple’s debt settlement process, Indonesia has officially appointed a third-party firm to meticulously verify repayment documents and conduct a thorough audit of all Apple Academies across the country. Moreover, between 2018 and 2023, the Ministry of Industry discovered that Apple’s compliance with the TKDN extension innovation scheme was insufficient. As a result, authorities have implemented stricter oversight measures to ensure adherence to regulatory requirements moving forward.
As part of its commitment to Indonesia, Apple is currently developing an AirTag manufacturing facility, projected to meet 65% of the global demand for AirTags. This factory investment is valued at $1 billion and is expected to generate employment for up to 2,000 workers.
Indonesia’s long-term goal is to encourage Apple to expand its investment to $10 billion, strengthening its role as a key manufacturing hub for Apple’s supply chain. The government sees this collaboration as a strategic step toward boosting local employment and advancing technological innovation within the country.
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