CET Cement controversy still in limbo

CET Cement controversy still in limbo
Published: 26 November 2007

TCL Guyana Inc., (TGI) a subsidiary of the TCL Group of Trinidad and Tobago, is adopting a ’wait-and-see’ position in relation to the Government of Guyana’s continued waiver of the 15 per cent Common External Tariff (CET) on cement imported from outside the region.

TCL Plant Manager Mark Bender told Stabroek Business in an interview earlier this week that while the Government of Guyana’s indication that it would seek to extend the CET waiver through the mechanism of the meeting of COTED held in Georgetown earlier this month had not materialized, the company was still waiting to see what procedures would be applied when the next shipment of extra-regional cement arrives in Guyana.

Top officials of TCL in Port-Of-Spain along with Bender have been making a case to the government here for some months now for the restoration of the 15 per cent tariff on extra-regional cement under the rules of the revised Treaty of Chaguramas. Bender told Stabroek Business that failure to restore the tariff could lead to the activation of dispute settlement procedures set out in the treaty. "as a last resort."

According to Bender TGI enjoys a 60 per cent share of the local cement market with the remaining 40 per cent of the market being filled by imports from Colombia, Venezuela and the Dominican Republic.

He told Stabroek Business that the US$10m cement bagging plant had been placed in a position where it had to compete with cement that was being "backhauled into Guyana" by exporters who were simply shipping various products overseas and bringing back cement rather than an empty vessel.

Bender said that the TGL bagging plant had been set up in Guyana at considerable cost and under conditions that included stringent environmental and other stipulations. "We are not at all sure that the extra-regional cement that is being imported into Guyana is required to satisfy those environmental conditions."

Bender restated the TCL’s position that the company was taking a position on the cement issue that was similar to the position taken by the Government of Guyana recently on rice imports by Jamaica from the United States.

Government officials here have raised the issue of price disparity between TGI cement and cement secured from extra-regional suppliers. However, Bender pointed out that apart from the fact that price was not an issue under the provisions of the CET the price differential was more than compensated for by the quality of the product that TGI was offering. "TGI was set up to take particular account of the Guyana market and among the facilities we offer are larger packages that are more convenient, our packaging also results in minimum burstage". Bender said that TGI had met the standards set by the GNBS.

TGI has pointed out that during the recent spat between Guyana and Jamaica over the latter’s importation of rice from the United States both President Bharrat Jagdeo and Agriculture Minister Robert Persaud had bluntly underscored the principle of the CET. Bender said that it was ironic that even as representatives of the Guyana Government were in Kingston some weeks ago seeking to defend the CET principle, TGI was simultaneously seeking to defend the same principle in Georgetown.

Bender told Stabroek Business that the provisions of the CET only required that the regional producer demonstrate a capacity to supply. Bender says that TGI had already demonstrated that capacity.