Indonesia Bans Sales of Google Smartphones

JAKARTA (Reuters) – Indonesia has banned sales of smartphones made by Alphabet's Google due to rules requiring the use of locally manufactured components. This decision follows the recent blocking of Apple’s iPhone 16 for the same reason.

Indonesia blocked Google Pixel phones because the company did not comply with regulations that necessitate at least 40% of the parts in smartphones sold domestically to be manufactured locally.

> "We are pushing these rules so that there’s fairness for all investors in Indonesia," stated Febri Hendri Antoni Arief, spokesperson for the industry ministry, on Thursday. "Google's products have not adhered to the scheme we set, so they can't be sold here."

Google stated that it does not officially distribute its Pixel phones in Indonesia. Febri mentioned that consumers could buy Google Pixel phones from abroad, provided they pay the necessary taxes, while the government may consider deactivating phones sold illicitly.

The ban comes shortly after Indonesia blocked the sales of the iPhone 16 domestically for not meeting local content requirements as well.

To comply with local content rules, companies typically increase their usage of domestic components by forming partnerships with local suppliers or sourcing parts within the country.

Interestingly, Google and Apple are not among the top smartphone manufacturers in Indonesia. According to research from IDC, the leading smartphone manufacturers in the first quarter of 2024 were the Chinese company OPPO and South Korea's Samsung.

With a large, tech-savvy population, Indonesia represents a crucial target market for technology investments.

Bhima Yudhistira, director of the Center of Economic and Law Studies, criticized the ban as "pseudo" protectionism that undermines consumer interests and diminishes investor confidence. He argued, "This creates a negative sentiment for investors looking to enter Indonesia."