Move to protect local cement firms hit

2018-12-25 20:20:12

The Philippine Cement Importers Association Inc. has questioned why the Department of Trade and Industry (DTI) was mulling over safeguard measures when cement imports spiked due to a shortage of supply.

In a statement, group president Napoleon Co said that any imposition of safeguard measures was unnecessary.

“There is no need for the DTI secretary to protect the robust domestic cement industry. Cement manufacturers continue to maintain their huge profits,” the statement said.

This developed as the DTI launched a preliminary safeguard investigation a few months ago in a bid to see if the domestic industry was being harmed by imports.

The probe was launched without any complaints filed, a move allowed under the Safeguard Measures Act, as an emergency relief provided to a domestic industry being “seriously injured” due to a sudden and sharp increase in imports.

Cement importers are not the only ones opposing the proposal.

Consumer group Laban Konsyumer Inc. also disputed the move to adopt safeguard measures, claiming these would create shortages in the supply of cement. The group is led by a former DTI official.

The Philippine Constructors Association (PCA) Inc. also said in a position paper that while this would favor local players, it would cause a “serious injury” to consumers and contractors.

PCA said that the measures would come in at a time when there are increased activities in the construction industry, particularly in the building of residential houses, condominiums, roads and other structures.

Given that cement is a major component in these structures, PCA said the imposition of safeguard measures “will surely tilt the balance and

adversely affect the buying public.”

“History shows that importation of cement was resorted to when the prices of local cement [were] increasing. Importation was done to neutralize the cartel of the local cement manufacturers,” it added.

There are a number of measures that could be imposed for some years, according to the Safeguard Measures Act. These include an increase or an imposition of any duty on an imported product.

However, there are conflicting claims on the state of the cement industry.

The Cement Manufacturers’ Association of the Philippines said that the local industry was fully capable of fully serving market demand.

Moreover, safeguard measures, it said, were needed so that the local industry could “realize its full potential.”

The investigation covers the past few years starting in 2013. According to a DTI report, imports have been increasing since then, though at different rates.

The volume of imports increased by 70 percent in 2014 compared to the year before, then 4,391 percent in 2015, 549 percent in 2016 and 72 percent in 2017.

This translates to just 3,558 metric tons in 2013, annually increasing until the import volume reached more than 3 million tons in 2017.

https://business.inquirer.net/262471/move-to-protect-local-cement-firms-hit/amp

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