By Leslie Gatpolintan
The Department of Trade and Industry (DTI) has ordered the imposition of definitive safeguard duty on cement for three years to protect the domestic industry from adverse effects caused by a surge in imports.
In a statement on Tuesday, September 3, Trade Secretary Ramon Lopez said they have decided on the application of definitive safeguard duty of P250 per metric ton (MT) or P10 per 40-kilogram (kg) bag for the first year of the implementation to “encourage and challenge” the local cement industries to be globally competitive.
The order shall take effect upon the issuance of the relevant Customs Memorandum or 15 days after its publication in two newspapers of general circulation this year.
Lopez said the amount of the safeguard duty will be reduced to P9 per 40-kg bag for the second year and to P8 for the third year, in pursuant to Section 18 of Republic Act 8800, otherwise known as the Safeguard Measures Act.
He noted a yearly review shall be conducted to determine the appropriateness of the safeguard duty.
“Basically, the rationale for the safeguard level is to balance national interest, minimizing the impact to prices for buyers and users while addressing the industry injury issue, and yet still encouraging local manufacturers to continuously pursue efficiencies to be more globally competitive,” he added.
While the DTI is mandated to protect the consumers, Lopez said there is a need to take into account other sectors, such as investors and industry which provide employment to Filipinos.
“There is also a need to moderate imports to balance trade. If local manufacturers can adequately supply domestic requirements, they need to be provided a level playing field to enable them to compete with imports. This will allow expansion of the country’s manufacturing base and generate more jobs for Filipinos,” he said.
The Trade chief also assured that the imposition of a safeguard measure is not expected to cause a shortage of cement in the domestic market considering that the cement manufacturers have sufficient capacity to meet domestic demand.
The Tariff Commission earlier recommended the application of a definitive general safeguard measure at P297 per MT or P12 per 40-kg bag on imported cement to prevent the occurrence of the threat of serious injury. (First published by PNA, Sept. 3, 2019)