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Good for you, JAKARTA - I hope it works great Indonesia plays hardball with smartphone manufacturers JAKARTA (Reuters) - When Polytron became the first Indonesian company to produce 4G-capable smartphones last year, it changed the 'Manufactured in China' inscription on its handsets to 'Made in Kudus,' a town in Central Java. Polytron relocated production from China to comply with 'local-content' rules introduced in 2012. The regulations have raised concerns about higher manufacturing costs and hung question marks over an industry championed by the Indonesian government. The United States has pressed Indonesia to relax the rules, which it says will hamper efforts of tech giants such as Apple Inc to expand into one of the world's last big markets where use of smartphones has yet to truly take off. Assembling far from China's electronics supply chain means it costs up to 50 percent more to manufacture a mobile phone in Indonesia, according to Polytron, a smaller player among local phone brands. "Honestly, we are doing it because of the regulation, to be in compliance," Polytron spokesman Santo Kadarusman told Reuters. The government ramped up enforcement of the rules last year. The regulations are part of a push under President Joko Widodo to transform Indonesia from an economy that consumes products into one that produces them, in his attempt to boost economic growth and eliminate the country's trade deficit. Most mobile phones sold in Indonesia are made in China. There was no phone manufacturing industry in Indonesia until last year when 15 companies submitted plans to the Industry Ministry to start production. Among them was Samsung Electronics Co Ltd, which opened a factory near Jakarta. The regulations require importers of smartphones to manufacture in Indonesia or have their import licenses revoked by 2016 or 2017, depending on when they received their license. The ministry is working on a new regulation targeting 4G smartphones. It is expected to be completed in June and come into force on Jan. 1, 2017. The rule will require all companies that sell 4G-capable devices, including Apple and Samsung, to produce a certain percentage of 'local content' in Indonesia. Apple did not immediately respond to requests to comment on the local content rule. Samsung declined to comment. It is unclear as to whether this regulation will replace existing requirements or how local content will be measured. Indonesia needs a bigger share of the $3 billion in annual phone imports to reduce its trade deficit, said Minister for Communications Rudiantara, who like many Indonesians goes by one name. "This phone is $600-$700, so we want $250-$300 of that to go to Indonesia," he said, pointing to his iPhone. LOCAL CONTENT Local content could include design through intellectual property fees in addition to manufacturing of handsets, Rudiantara said. He declined to give further details on the way the percentage of local content would be calculated. Around a fifth of local content would have to be research and development, meaning companies would need to have a design development center in addition to manufacturing, said Industry Minister Saleh Husin. Critics of the 'Made in Indonesia' rule, including the American Chamber of Commerce, say the requirement is confusing and could increase costs, restrict access to technology and violate World Trade Organization ( WTO ) obligations. The U.S. Trade Representative is raising these concerns with the Indonesian government and the WTO. But Polytron is optimistic about the move, and expects its mobile division to make its first profit since it started in 2011 by the end of the year. "Our support from the government is the promise that other 4G brands cannot sell in Indonesia if local content is not 30 percent. Polytron is already at 35 percent. If Polytron gets to 40 percent local content, [the government told us] there is a possibility the local content requirement will go to 40 percent," Polytron spokesman Kadarusman said. He declined to comment on how the local content percentage was calculated. Rudiantara said that after hearing of complaints, he was "undecided" on whether the required local content would be 40 percent, which he previously told companies. He planned to release a draft of the regulation in mid-April to give companies time to raise concerns. He said higher costs would make it difficult for Indonesia to compete purely on manufacturing, but hoped his switch to include research and development would help. "I'm not crazy. Ministers should have nationalism, but not chauvinistic nationalism," Rudiantara said. "If Indonesia competes only on producing hardware, it's going to be difficult." ________________________________ America needs to be quiet and take heed, and learn how to bring industry back to America. Apple does not benefit Americans, it only sucks their money and then plays the stock games, which only benefit the wealthy and make chumps out of the masses promoting a new model every 6 months, not one of which is made in America and does not produce nor provide jobs for American people. Good for you, JAKARTA, you are much smarter than American Executives. Silly American executives trying to protect Apple, at the expense of the American people remaining unemployed and too ignorant to open up industry on American soil. The American Executives is proving more and more to be imbeciles who have no concept of respect for its own nation and its nations need of industry. I can guarantee that people of Jarkata will buy phone made in Jarkata, and not get hung up on the Apple or Samsung brands as if there can be no other. Indonesia should not buy into this delusion: Assembling far from China's electronics supply chain means it costs up to 50 percent more to manufacture a mobile phone in Indonesia, Because once industry is established, the supply chain will come and find you.... !!!! so don't listen to such madness, just trust in time and good works it will bring the cost be to functional, so don't listen to this kind of crap talk. America listened to it and gave its Industry away, now everything in America suffers for listening to this kind of craziness promoted by greed executives, goon trained economist and bought and paid for mouthpieces of the executive culture. Jarkata, stick with your plan and don't be swayed by those who would seek to deter you !!!!! competition has always brought the cost down... and it will do the same as you ramp up to build your phones on your own soil. Apple and Samsung pay a great deal to "talking heads" to promote the propaganda, trying to keep others out of the game, when fact is: most phone companies provide incentives where most don't pay anything near that price for phone. Trust that your phone companies will find means to make your phones affordable. and they will build the network capacity to make it meet the needs of your people. |
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Thank you for your good prayers, Beyond. All Indonesian people expect much from the new government. Although many people are happy with the changes, but not a few people who oppose the new government because it means they lost the opportunity for corruption. Industry is what builds nations, and nations smart enough to retain their industry are also nations which build a solid means to sustain themselves. America got too entrenched in the "seek a slave" mentality, until it would do anything and give up anything in search of slave labor wages and canvased the globe seeking out cheap slave wage labor and government whom would play along to provide it. American among the wealthy power elites who influences society, still harbors anguish at black people, because black people would not be silent and remain being slaves, and since then it has done all it can to paint negative imagery and support diminished areas of limited opportunity in it's overt and covert anguish at being unable to use black people for slave type labor and the low wage labor it enjoyed during the long period of segregation.
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If you not, there is no prominent volume of black faces in silicone valley and the venture capitalist will not entertain the black inventors. It has embraced the Chinese but in the early 80's it had no affinity for the Chinese, only since production is now on China's land, does it embrace Chinese. They pursue India, for one motivation is India has technical expertise, and a certain ritual like discipline, which makes them easily trainable. but it also has a large population of labor which can be gained for very low pay. If and As India move up and demand more respectful labor for its people, the embrace of India will wane, because it does not fit into the "seek a slave labor wage pool", that seems to be a mindset American executives can't get out of their system. China played along until it had enough transferred wealth, now it has no problem telling the American Executive to Go Home, and replaced them with Chinese Executives. China was smart in this sense, it used the American Executive to Open up Amerian markets, once they were open, there was no more need for the American Executive, and China found its ways to send them packing. Now they can only come back trying to make deals, but, they now have to make deals on China's terms. That's why China can tell them, if you want to produce and want China to buy your technology, YOU MUST GIVE CHINA THE SOURCE CODE AND BUILD BACK DOORS FOR CHINA TO ACCESS. China already knows they won't do it. So this is another mean to get them out of China's business and China to use Chinese Made Hardware and Chinese modified programs, so Chinese business use Chinese branded products. Now China looks to build strong relations with other Asian Nations, and once that alliance is built, they will; as they are pushing more to ensure they are never again dominated by Western Powers in the Asian Nations. The blind Arrogance of the West, as with all western empires, fall because of their own blind arrogance, Their hey day of the Post World War II leadership role is more than 60 yrs ago, and there are Baby Boomers in American who just can't fathom that things have changed and the hey day of such glory stomping is no longer viable. the computer has give information and knowledge to all corners of the world that accept it, and it can't be retracted. Indonesia has to build with determination and it has to learn from the games of losses that other nations suffered. To win, it has to improve and build upon the respect for the people, trust in the capabilities of the people and then it has to work very hard to root out corruption which has a long time to entrench itself. The corruption may well be the big challenges, because those who gained power by such means, won't give it up without a challenge of many sorts. The government has to not succumb to it, and the people must stand to ensure they do what they can to keep the government being in support of the people and not subjects of the corrupt power players.
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