Cement safeguard ‘counter-intuitive’
Credit to Author: TYRONE JASPER C. PIAD| Date: Wed, 06 Feb 2019 16:19:00 +0000
Imposing a safeguard duty on cement imports may not be the best thing to do while pushing a massive public infrastructure program, the chief of the Management Association of the Philippines (MAP) said.
“I don’t quite personally understand. Because if you’re trying to encourage construction, in the ‘Build Build Build’ [program], it will really be counter-intuitive to increase the price of cement,” MAP President Rizalina Mantaring told The Manila Times.
The Trade department last month ordered a provisional safeguard duty of P8.40 per 40-kilogram bag — almost 4 percent of the average retail price of P220 per bag — in response to surging imports said to be hurting the local industry.
The department claimed that cement imports had ballooned to over 3 million metric tons in 2017 from just 3,556 MT in 2013, while the share of imports rose to 15 percent from only 0.02 percent during the same period.
Mantaring said the imports were probably prompted by supply shortages given the government’s infrastructure drive.
“The local players are selling all they can. In fact, ubos ang production nila (their entire output has been consumed) … I don’t see that there’s a problem for the local manufacturers because they are selling all that they produced,” Mantaring added.
Cement demand over the last three years (2015-2017) amounted to 78.88 million MT but the local cement firms only produced 73.12 million MT, government data showed.
The trade department has said that the safeguard duty would prod local manufacturers to expand capacity to meet cement demand.
The provisional safeguard is scheduled to take effect this Saturday, February 9, and will be effective for 200 days. The Tariff Commission is currently studying the matter with a view of possibly extending it to three or four years.
Mantaring said the MAP was also studying the issue, saying: “We’re looking at the impact of it (the safeguard duty on cement) a little bit more.”
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