The Department of Trade and Industry (DTI) on Tuesday slapped a definitive safeguard duty on imported cement that will be effective for three years.
In an order, Trade Secretary Ramon Lopez said the amount of the safeguard duty to be imposed for the first year shall be P250 per metric ton (MT) or P10 per 40-kilogram bag; P225 per MT or P9 per 40-kg bag for the second year; and P200 per MT or P8 per 40-kg bag for the third year.
The safeguard duty will be effective 15 days after the publication of the DTI’s order. A yearly review shall be conducted to determine the appropriateness of the safeguard duty.
“The rationale for the safeguard level is to balance national interest, minimizing the impact to prices for buyers and users while addressing the industry injury issue, and yet still encouraging local manufacturers to continuously pursue efficiences to be more globally competitive,” said Lopez.
The DTI in January slapped a provisional safeguard duty of P8.40 per bag on cement imports to address a shipment surge said to be hurting the local cement industry.
The amount, equivalent to just under 4 percent of the average retail price of P220 per 40-kg bag remained in effect for 200 days.
Lopez earlier claimed that “imports of cement increased from only 3,558 MT in 2013 to more than 3 million MT in 2017 and the share of imports increased from only 0.02 percent to 15 percent during the same period.”
Following the imposition of provisional safeguard duty, the Tariff Commission conducted several public consultations to determine whether a definitive safeguard measure should be in place.
Last month, the commission recommended to impose a higher safeguard duty of P297 per metric ton or P12 per 40-kilogram bag.
“Accordingly, the DTI has reviewed the commission’s findings and recommendations and has established that the imposition of the definitive general safeguard measure shall be in the public interest,” Lopez said in the order, a copy of which was sent to media.
Lopez said DTI has taken into account public interest in the decision whether to impose safeguard measures and has considered other factors that will assist the local industry and benefit the consumers and end users.
Republic Act 8800 or the Safeguard Measures Act, mandates DTI to protect domestic industry from serious injury caused by a surge in imports.
“While DTI is also mandated to protect consumers, there is a need to balance this taking into account other sectors such as investors and industry which provide employment to Filipinos. There is also a need to moderate imports to balance trade. If local manufacturers can adequately supply domestic requirements, they need to be provided a level playing field to enable them to compete with imports,” said Lopez.
“Further, users of cement retain their option to choose between the local and imported cement since imports will still be allowed. The imposition of a safeguard measure is not expected to cause a shortage of cement in the domestic market considering that the cement manufacturers have sufficient capacity to meet domestic demand,” he added.