An anti-graft group questions the integrity of the alleged rising technical smuggling in the cement industry as declared by Cement Manufacturers Association of the Philippines president Ernesto Ordoñez.
4K secretary-general Rodel Pineda disagrees with the figures of Ordoñez wherein an estimated 75 percent of the 161,000 metric tons (MT) of imported cement that entered the country in the first quarter alone were technically smuggled. 4K stands for Kilusan Kontra Kabulukan at Katiwalian, which is duly registered with the Securities and Exchange Commission.
“Something fishy is going on. If this is the case, how come that the price of the local cement in the Philippines is much higher than the alleged imported cement from Vietnam? Is it because most of the local cement manufacturer and limestone mining in the Philippines are owned by Swiss, French, Japanese and Mexican nationals?” Pineda said. “If there is one thing that’s really transpiring here is the continued operation of the cartel in the cement industry. If Cemap is truly being nationalistic about buying Filipino first, the local cement should be cheaper than the imported ones from Vietnam.”
Pineda cited that the cement acquired from Vietnam has a PS Mark from the Department of Trade and Industry even before it was released for public consumption.
“They even sent their DTI representative to Vietnam to perform quality test so that the Filipino consumers will get their money’s worth in buying their product, so what’s the big deal with their alleged technical smuggling?” Pineda explained. “If what Mr. Ordonez said is true, he should ask the DTI or even file cases of corruption against those DTI officials.”
Pineda even expressed his concern about the monopolistic activity in the cement industry. Being an integral part of all infrastructure projects in the country, the cement industry is likely to have company tax perks like tax holiday while their company is still setting up their plants or still on its initial operation.
“They are already benefitting from the Philippine Economic Zone Authority. They are getting special treatment from our government so what are they still complaining about?” said Pineda. “There is no technical smuggling among importers and what the cement cartel is trying to do is just to maintain a shortage in their products to make a killing because infrastructure is booming in our country,” said Pineda who is fearing the possible cement shortage scenario so that the CeMAP can make their statement true.
“This is one of the social and economic issue that we are fearing about. We just hope that the government should take a look about the hidden agenda of CeMAP. As Filipinos, we should always fight for equality, whether for the right to live or the right of equal business opportunity. We should stop the practice of monopolization,” said Pineda.
As to the accusation of Ordoñez that there are nine undervalued shipments of cement from Vietnam and China that were undetected by freight price at $10 per MT to as low as $3 per MT, this is a clear case of libel because he must consider the model of ships used by the importers, the backload of the vessels, volume contract, time charter, bareboat charter, age of vessels and others.
“Although Ordonez was a former undersecretary of Department of Agriculture and Trade and Industry, he is not really from cement industry. It seems the cement cartel assigned him as attack dog because the issue here simply is supply and demand. President Aquino signed Executive Order No. 22 reducing the rates import duty on cement and cement clinker to zero because of shortage in local production that affected the price of the product our country need in infrastructure,” Pineda added. “Mr. Ordones’ accusation is very malicious, it is clear that the statement issued by the CeMAP was only to insinuate that there is a rampant technical smuggling, misclassification and sub-standard issue on the part of importers without basis or foundation.”
“The issue that there was a misdeclaration of freight was shallow. Bureau of Customs regulation freight should be minimum of 10% of the declared value. In all importation, BOC will not approve if freight is below 10%, it is the rule of the thumb that minimum of 10% of the value is acceptable freight, as so many factors affects freight, and it is so malicious on part of Mr. Ordonez on a baseless freight issue to insinuate misdeclaration and substandard product where in fact it is not happening,” Pineda said. “And the real hidden agenda of Mr. Ordonez is monopolization. He is just bullying the traders to stop importing cement and if there is a shortage, multi-national companies will jack-up the prices at the expense of Filipino consumers.”