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Speaker 1: Pete Lewis is that Asia Business correspondent Hypeter hi O

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Speaker 1: Ryan And now Indonesia and Apple are apparently agreeing on

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Speaker 1: terms to lift an iPhone sixteen band. What's this about?

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Speaker 2: Yes, Well, this is to do with a regulation that

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Speaker 2: smartphones that are sold in India have to have forty

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Speaker 2: percent of their contents and their components sourced locally. Now,

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Speaker 2: this forty percent role has been a problem for a

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Speaker 2: lot of manufacturers in Indondes because it's quite hard to meet.

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Speaker 2: It's actually very difficult to find all the bits and

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Speaker 2: components that you need locally to be able to put

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Speaker 2: into a smartphone like an iPhone sixteen. Well, it was

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Speaker 2: deemed by the indondes In government that Apple didn't meet

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Speaker 2: this forty percent requirement, so they banned sales altogether of

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Speaker 2: the iPhone sixteen until it was resolved. Now, the interesting

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Speaker 2: thing about this is that Apple has tried very hard

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Speaker 2: to result little bit because Indonesia is a very big market.

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Speaker 2: There's about three hundred million people there, so it's certainly

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Speaker 2: a market that Apple wants to operate in. It initially

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Speaker 2: offered ten million dollars to invest that was nowhere near enough.

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Speaker 2: It offered one hundred million dollars then to go and

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Speaker 2: invest in Indonesia, and then finally it offered one billion

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Speaker 2: dollars to completely build a new plant in India, but

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Speaker 2: the government turned it down and said, despite it being

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Speaker 2: a billion dollars, you still weren't sourcing forty percent of

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Speaker 2: your components locally. What they have now done is they've

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Speaker 2: come to an agreement where there are going to be

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Speaker 2: a couple of new plants from Apple in Indonesia and

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Speaker 2: they're going to invest about three hundred and fifty million.

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Speaker 2: So what the Indonesian government hasn't explained here is how

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Speaker 2: they've ended up going down from a one billion dollar

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Speaker 2: investment to three hundred and fifty million dollars. Why didn't

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Speaker 2: they accept the initial one billion dollars because you know,

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Speaker 2: this is a very significant investment in an emerging market

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Speaker 2: like Indonesia. But anyway, everyone seems to be happy. The

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Speaker 2: government seems to be happy, Apple seems to be happy.

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Speaker 2: They're going to be providing jobs for local people there

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Speaker 2: when they build this factory, which will be Apple's very

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Speaker 2: first one Indonesia.

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Speaker 1: Fascinating and what a low ball to start with the

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Speaker 1: ten million dollars I'm glad they come one.

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Speaker 2: That's someone in the Indonesian government hasn't got the art

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Speaker 2: of the deal.

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Speaker 1: No, certainly not. Now Taiwan has apparently caught a Chinese

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Speaker 1: own ship cutting a sub seed cable. What's this about?

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Speaker 1: What was the cable for? And have we had confirmation

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Speaker 1: from the Chinese on the salt or what?

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Speaker 2: We haven't heard a word from the Chinese. The Taiwanese

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Speaker 2: governments say that they caught red handed this this boat

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Speaker 2: attempting to cut an underwater cable. These are the cables

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Speaker 2: that provide international data traffic and provide Internet. We've seen

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Speaker 2: this in the Baltics, with Russia cutting cables around the

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Speaker 2: Baltic States and around Finland. Now in Taiwan, they call

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Speaker 2: this gray zone activities. In other words, it's sort of

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Speaker 2: activities that fall short of an act of war, but

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Speaker 2: nevertheless they're very intimidating. So the sort of things that

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Speaker 2: Taiwan that China does here is providing putting blockades around

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Speaker 2: the island, harassing local fishermen and fishing boat, cyber attacks

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Speaker 2: and so on. So this is part of those what

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Speaker 2: they call gray zone operations. Have been going on now

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Speaker 2: for quite a while around Taiwan. As you know, to

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Speaker 2: China wants to have a reunification between the mainland and Taiwan.

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Speaker 2: The Coastguard call the boat. It was just staffed with

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Speaker 2: Chinese nationals. They've been taken back to Taiwan and local

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Speaker 2: prosecutors are investigating. But this all comes at a rather

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Speaker 2: difficult time for Taiwan because they're watching nervously what is

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Speaker 2: going on with Ukraine and there is a feeling obviously

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Speaker 2: that Ukraine is maybe being sold down the water here.

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Speaker 2: And what is the US's stance going to be on Taiwan.

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Speaker 2: Donald Trump hasn't actually said so far what his thoughts

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Speaker 2: are about Taiwanese, about the harassment that's going on around Taiwan,

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Speaker 2: and about the reunification of China, of mainland China and

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Speaker 2: the island. So we wait to see. But people in

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Speaker 2: Taiwan are quite nervous about this.

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Speaker 1: Yeah, I can imagine now Trump at the White House

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Speaker 1: taking aim on Chinese trade and investment. We know that

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Speaker 1: he's put some of those tariffs on then how's that

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Speaker 1: been received there?

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Speaker 2: Well, this is going to become a big issue because

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Speaker 2: just in the last twenty four hours Taiwan, Trump has

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Speaker 2: said he's going to double the tariffs that are on

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Speaker 2: Chinese goods. They were originally set at ten percent. These

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Speaker 2: were actually, out of all the tariffs that he's threatened,

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Speaker 2: the only ones that actually went into effect at the

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Speaker 2: beginning of the month. Well as of March the fourth,

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Speaker 2: they are going to become twenty percent, along with twenty

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Speaker 2: five percent tariffs on Mexico and Canada. It's not totally

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Speaker 2: clear why they're being doubled on China. It's made clear

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Speaker 2: that he's unhappy with Mexico and Canada because of fentanyl

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Speaker 2: going over the border, which he says is flooding in

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Speaker 2: through Canada and Mexico. China and the US have been

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Speaker 2: working quite hard in the last year or so on

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Speaker 2: the fentanyl issue, and China believes it had made quite

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Speaker 2: good progress with the US on this. So it's rather

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Speaker 2: bemused as to why it's now had these tariffs doubled.

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Speaker 2: It'll be interesting to see what China will do. Last time,

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Speaker 2: at the beginning of the month, they introduced their own

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Speaker 2: tariffs within minutes of the US ones coming into effects.

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Speaker 2: The problem is, there aren't a lot of things that

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Speaker 2: China can put tariffs on, so the best thing that

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Speaker 2: it can do here while all this is going on

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Speaker 2: is try and boost its own domestic economy. It's what

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Speaker 2: known as the two Sessions coming up next week, which

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Speaker 2: is the annual meeting of the Chinese legislature. They're going

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Speaker 2: to focus on the economy and trying to find ways

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Speaker 2: of boosting the local economy. This will be the best

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Speaker 2: way of trying to counter all these actions. Trump's talking

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Speaker 2: about other things as well. He wants Mexico to put

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Speaker 2: tariffs on Chinese goods because some countries are rerouting their

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Speaker 2: products through Mexico, and is also threatening to put a

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Speaker 2: tariff on any Chinese made ship that docks anywhere in

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Speaker 2: the US. Yes, now, as he does that, that's going

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Speaker 2: to have a huge impact on international trade and relations

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Speaker 2: with not just China, but with a host of other

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Speaker 2: countries as well. So it seems that, you know, China

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Speaker 2: may be the main target of all these tariffs because

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Speaker 2: Trump is certainly ramping up the pressure at the moment.

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Speaker 1: Certainly is thank you so much for that, Peter, A

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Speaker 1: very comprehensive wrap from you. Peter lewis our Asia business

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Speaker 1: correspondent with us for more from hither Duplessy Alan Drive,

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Speaker 1: Listen live to news talks it'd be from four pm weekdays,

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