Cement producers oppose 2007 incentives

Cement producers oppose 2007 incentives
Published: 25 April 2007

Local cement producers have strongly opposed the plan of the government to extend incentives to new players in the industry, saying it will create an unfair non-level playing field.

Cement Manufacturers Association of the Philippines Inc. president Ernesto Ordoñez has sought an audience with Finance Secretary Margarito Teves to clarify the position of the Department of Finance favoring the inclusion of cement in the proposed 2007 Investments Priorities Plan.

“We are surprised why DoF took this stand of providing incentives because in general we know the DoF does not advocate giving incentives if there is no valid reason,” Ordoñez said in a letter to Teves dated April 18.

Ordoñez was referring to an earlier statement made by Trade Undersecretary Elmer Hernandez, who claimed that it was the finance department that recommended the granting of full incentives to new cement projects by including them in the proposed 2007 IPP.

Hernandez, managing head of the Board of Investments, earlier said the finance department recommended perks to new cement projects if they were integrated with mining.

New players in the cement industry should also mine lime stones and not only rely on imported clinkers for their raw material requirement in order to avail of incentives under the Omnibus Investments Code of 1987.

For existing players to be entitled to incentives, they should also expand to mining activities to provide raw materials for the expansion of their existing capacities.

Local cement manufacturers have been in touch with the Department of Trade and Industry bucking the inclusion of cement in the 2006 IPP and now the proposed 2007 IPP.