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Safeguard Duty on Cement Imports may stall Public Infra

SLAPPING additional duties on cement imports to safeguard local manufacturers could lead to shortage and the eventual delay of the government’s infrastructure projects, importers argued on Wednesday.

The Philippine Cement Importers Association Inc. said there is no need for the Department of Trade and Industry (DTI) to impose safeguard duty on cement imports. Napoleon Co, the group’s president, argued the local industry is in a good position and can withstand competition.

The “Build, Build, Build” program, cement importers said in a statement, faces delays due to severe cement shortage. Sales of cement is now being rationed or allocated in several parts of the country, as cement manufacturing and importation cannot cope with the increased demand.

The country has seen growth in construction after President Duterte’s election in 2016. Cement demand expanded to 28.5 million tons last year, and is expected to reach 30 million tons this year.

Cement importers added the government encouraged the importation of cement to fill in the shortage of 2.5 million tons in 2016 and almost 3 million tons last year. Cement producers Holcim, Republic and Apo are some of the biggest importers.

Co is dumbfounded as to why Trade Secretary Ramon M. Lopez initiated a motu proprio investigation on the influx of cement imports when the imports were reportedly made to fill in the supply gap.

He added the local industry can withstand the entry of imports, as it maintained robust growth in spite of the influx of its foreign counterparts. Cement manufacturers posted total sales of P109 billion and industry earnings of P14.7 billion last year, according to Co.

With this, Co concluded that an additional safeguard duty will only increase prices and aggravate the shortage. He explained it will take three years to four years to commission new plants that can fill up the requirement.

Co said importers came to the government’s rescue when the shortage sprouted and wondered why they are now being threatened with safeguard duty. He claimed several cement importers have halted importation when the motu proprio investigation was launched. Lopez in September initiated an investigation to determine whether the government should impose safeguard measures on cement. This, after the DTI found imports of the construction commodity rose in significant volumes the past years to the detriment of local players.

by Elijah Felice Rosales