Philippine cement manufacturers said they would formalise their position before the Tariff Commission to restore the five per cent duty on imported cement as the threat of imports flooding in an open market is very real.
The Manila Bulletin reported that the Tariff Commission will conduct public hearing next week, July 28, regarding the review of the zero rates of duty on cement and clinker
The Cement Manufacturers Association of the Philippines (CeMAP) said they will formally present their position before the Commission against further extension of Executive Order 862 granting duty-free importation of cement and clinker.
Then President Gloria Arroyo issued EO 862 last February 24, 2010 extending the zero duty on imported cement for another six months to encourage imports to come in and prevent local cement producers from further raising prices of cement. The EO will expire next month, August.
Although the duty-free privilege has not encouraged cement imports to come in, it was effective in preventing further increases in prices of local cement. Imported cement is slapped with a 5 percent tariff. Prevailing retail cement prices range from P213 to P216 per 40kg bag.
“We would like to retain 5 percent tariff on cement for the basic reason that we are still under threat of dumping from countries with excess cement capacity,” a CeMAP official said.
“The threat is there and the 5 percent tariff shield would keep imports bay,” he said.
Other ASEAN countries still maintain high tariff walls against cement importss. Thailand imposes 8 percent tariff and Vietnam at 30 per cent.
The local cement players have also to bear the high cost of power, which accounts for 40 percent of their production. On the other hand, CeMAP said, the cost of power in other countries like Malaysia, Thailand and Indonesia is just half of the Philippines.