NUSA DUA: Foxconn Technology Group, the electronics contract manufacturer from Taiwan that counts iPhone maker Apple as a client, says Indonesia's tax policy is one of the main topics to discuss before it invests potentially billions of dollars in the country.
Terry Gou, president and chief executive of Foxconn, told reporters last Monday that Indonesia's tax system was a concern because the Customs department gave zero tariffs on imports of finished mobile phones, but at the same time, imposed tax on imports of components. Imports of industrial goods are taxed at a range of five to 15 per cent.
"That means that your policy is against attracting people coming here to invest. The finance department should consider this," Gou said after the closing of the Asia-Pacific Economic Cooperation (Apec) CEO Summit in Bali.
Gou declined to reveal how much his company might invest in Indonesia, saying only that it would be a major investment, where the company was "building the whole supply chain and not just coming here to leverage the local cheap labour."
He said the company would not just develop hardware, but also software.
Simon Hsing, a spokesman for Foxconn, added that the company wanted to grow and build up the information and communications technology (ICT) industry in Indonesia and help develop local brands.
"We are not just making cellphones here. We make hundreds of consumer electronic products around the world that we can bring to the country as long as you are ready," Hsing said.
Gou said Indonesia, with its large and young population, had great potential to grow its ICT industry.
He said he believed Indonesia would continue to attract investment over the next decade or two.
Industry Minister M.S. Hidayat said at a press conference yesterday that he would personally address the tax concerns raised by Foxconn, adding that he had met briefly with Gou.
"This (investment) is important for me because the import of handsets has reached 100 million units per year," Hidayat said.
He also said that the company, which could invest up to US$5 billion (RM15.9 billion) over several phases, had asked for the government's participation in building a research laboratory in Indonesia.
Foxconn produces a large variety of electronic products and components for other companies, and Apple's iPhone is the most popular product it makes.
Gou said he would travel to Jakarta after the Apec summit ended yesterday to talk to potential business partners and government officials.