Chinese investment in Southeast Asia is set to enjoy another boost, as Xiaomi announced it is set to open an assembly plant in Indonesia. Indonesia is a large and important market for Xiaomi, which has opened the plant in order to receive approval to sell its Redmi 4A smartphone in the Southeast Asian giant.
The assembly facility is to be located on the island of Batam, just a short boat ride from Singapore, and is expected to produce over 100,000 of the smartphones every month. The devices will be sold through Indonesian retailer Erafone and are expected to go on sale by the end of the month. Market watchers will be interested to see how the 5-inch screen, $113 device fares in the Indonesian market.
Indonesia’s protectionist policies regarding smartphone stipulate that all 4G LTE smartphones must be comprised of at least 30% “local content” in order to go on sale in the country. It is thought that Xiaomi’s operation will cover assembly and packaging, and perhaps even some elements of design software and R&D.
After the Chinese company’s initial hesitation, its success in the Indian market, set against a backdrop of a decline in sales globally, has spurred on its interest in the large Indonesian market.