The Philippines automotive industry opposes a plan to impose safeguard duties on 34 additional Thailand products amid the trade dispute between the two countries.
The Chamber of Automotive Manufacturers of the Philippines Inc. said the inclusion of additional goods from Thailand in the list of items subjected to safeguard duties would negatively affect the entire auto supply chain.
“CAMPI does not undermine the effort of the Philippine government, and we sympathize on the DS 371 [dispute case] but the auto industry has been targeted for retaliation and we cannot underestimate all things, considering we are in the auto industry, as innocent bystanders,” said CAMPI president Rommel Gutierrez during a hearing at the Tariff Commission.
DS 371 refers to the case “Thailand -Customs and Fiscal Measures on Cigarettes from the Philippines” filed by the Philippine government before the World Trade Organization.
Local auto parts makers led by the Philippines Parts Makers Association proposed to include 34 more tariff lines to beef up the list of Thai goods up for additional duties.
These include muffler and exhaust pipes, speedometer, tachometer, instruments panels clocks, lighting or visual signalling equipment, wiring harnesses, battery cables, safety seatbelts, parts for compression-ignition internal combustion engines, air conditioning machines, ignition coils, fuel cut-off valves, and unassembled starter motors for engines of vehicles, among others.
The new list will add to the previously identified 37 tariff lines from Thailand that stand to lose their current concessions, if Thailand continues to refuse to comply with the WTO ruling on the tax case of imported tobacco from the Philippines.
The Department of Trade and Industry said the only way it could pressure Thailand to cooperate on the cigarette tax case is impose higher taxes, through safeguard duties, on certain products exported from Thailand to the Philippines including automobiles.
The Thailand Automotive Industry Association expressed concern that both sides would be adversely affected by such measure when both economies were “already experiencing bad business because of the pandemic.”
”One can clearly see the imbalance and disproportionate impact on Thailand. The impact would cut both ways and implications will be far reaching. We hear by appeal to Philippines not to proceed with the proposed tariff concession,” the group said.
TAIA is a leading Thai association with 30 member-companies.
The DTI insisted that the proposed measure is the “ultimate remedy” on existing concerns with Thailand.
“But as we exercise our rights, of course, we want to minimize the adverse effects to other industries and consumers of any measure that the government will take and that is a paramount consideration of the country,” said Trade assistant secretary Allan Gepty.
He said there would be further study and evaluation of proposals and comments. The deadline for the submission of position papers is Sept. 8, 2021.