LOCAL manufacturers are asking the government to raise the safeguard duty on cement to remedy the serious injury they suffered due to the surge in imports over the past years.
At the public hearing on Monday, the Cement Manufacturers’ Association of the Philippines (Cemap) appealed to the Tariff Commission to increase the safeguard duty on cement. It claimed imports continue to rise in spite of a provisional tax of P8.40 per bag in place.
“Our appeal, therefore, is for a higher tariff rate to cure the serious injury,” said Cirilo Pestaño, executive director of the Cemap, at the public hearing.
Data presented by Cemap showed the volume of imported cement jumped 64.15 percent to 1.74 million tons in the first quarter, from 1.06 million tons during the same period last year. The government in January decided to protect the local industry by imposing a provisional tax of P8.40 per bag on imports.
With this, the group said it supports the government’s preliminary tariff and is demanding a definitive safeguard duty of a higher rate.
Pestaño said cement demand from infrastructure is projected to climb to 33 percent of total cement demand by 2021, up from 2016’s share of 27 percent. Cement demand could hit up to 52 million tons by 2025, he added.
He said manufacturers have expansion projects in the pipeline, some of which have been commissioned and are scheduled for funding this year.
With this, local players said it is important to protect them given their larger economic contribution and higher tax paid to the government. On top of this, they also employ more workers than importers do. The government slapped a provisional tax on imported cement after the domestic industry supposedly got injured from the surge in imports between 2013 and 2017.
Market share of imports rose to 15 percent in 2017, from 0.02 percent in 2013, according to government data. Sales of the local industry reportedly fell 12 percent, or P11.1 billion, in 2017, as manufacturers were compelled to reduce prices by almost 10 percent to compete with imports.