Cement importers said Wednesday the imposition of a safeguard duty on imports may encourage local manufacturers to raise their prices.
A group of cement importers raised this concern, in anticipation of a decision from the Trade Department which launched an investigation into the increasing volume of cement imports.
“Once the safeguard is implemented, the additional tariff will be a big burden to importers whom many will cease operations due to unfair pricing and competition. If this happens, local cement manufacturers will start hiking their prices to be at par with imported cement,” said Philippine Cement Importers Association Inc. president Napoleon Co.
Co said some importers might not cope up with higher importation cost as a result of the safeguard measure.
The group said local cement manufacturers continued to rake in huge profits, posting combined industry sales of P109 billion and net earnings of P14.7 billion in 2017.
The group said several cement companies earned billions of pesos from sales ranging from P11.2 billion to P27.3 billion in the first three quarters of 2018.
Importers warned an additional safeguard duty on imported cement would result in price increases and aggravate the supply shortage, as it would require three to four years to commission new cement plants.
The importers group said that while they ran to the rescue of the government to address the shortage, they were now being threatened by additional safeguard duty to discourage importation.
Several importers halted cement importation after the Trade Department launched the safeguard investigation in September.
Co said the imposition of an additional safeguard duty on imported cement was ill-timed given the increasing demand for cement to support the government’s ‘Build, Build, Build’ infrastructure program.
Cement demand reached 28.5 million tons in 2017 and was forecast to hit 30 million tons in 2018.