Philippine cement firms want 5% tariff kept

Philippine cement firms want 5% tariff kept
Published: 08 October 2008

Philippine cement producers have appealed to the government not to let go of the country’ only remaining strategic and high value added manufacturing sector by keeping the only protection left to this domestic industry against the very real threat of dumping by countries with excess capacity. Ernesto M. Ordonez, president of the Cement Manufacturers Association of the Philippines (CeMAP), explained to reporters that once the 5 percent tariff on imported cement is lifted this would send a signal to countries that the Philippine government does not support strategic industries and dump cement here rendering the country’ only remaining high value added manufacturing sector inutile.

The technical working group of the Committee on Tariff and Related Matters has already started deliberating on the proposed duty-free importation of cement.

Ordonez pointed out that aside from being a very strategic industry it is also the only remaining domestic industry with high local value added because all its raw materials except coal are sourced domestically.

Unlike the Philippines’ percent tariff, other countries in the region have kept their cement tariffs higher –alaysia at 50 percent, Vietnam 40 percent, and Thailand at 10 percent.

Regional free trade deals being forged by ASEAN with Korea and Australia-New Zealand have also considered cement manufacturing a strategic industry and agreed to classify cement as a sensitive industry, making its phase-in into zero tariff lines much later than other industries.

"The 5 percent tariff cover is important even if it is small," Ordonez said stressing that by keeping the tariff cover this tells other exporting countries that the Philippine government supports strategic industries.

"The threat of dumping is very real. If China sells at least one percent of their supply that is already 100 percent of our total demand then they are going to wipe us out," he said.