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THE
government will try to make cement more affordable to
keep the building sector continuously active in the face
of the worsening global economic downturn by eliminating
the 3-percent to 5-percent tariff on the construction
material.
Tariff
Commission chairman Edgardo Abon said the Board of
Investments (BOI) has been tasked by the technical
working group of the Committee on Tariff and Related
Matters to complete a draft proposal in two weeks from
Thursday.
The
draft is supposed to be submitted to the Cabinet for a
final review and recommendation to the Palace for an
executive order to make it official.
Trade
Secretary Peter Favila had said earlier this is being
done in response to the “unsubstantiated” increases in
the prices of the locally produced and imported cement.
Favila
announced last month he will recommend the elimination
of the tariff on imported cement after the
foreign-dominated domestic cement industry failed to
justify to his satisfaction recent spikes in the prices
of the commodity.
Favila
has also asked customs to speed up the processing and
release of imported cement once the tariff is removed in
order to give the building industry fast relief.
Holcim
of Switzerland and Lafarge of France recently increased
prices from P10 to P12 for 40-kilogram bags of cement.
Favila
said documents given by the two companies failed to
substantiate the grounds for the increase, prompting him
to recommend the tariff
removal.
Renato
Sunico, president of Republic Cement, which is
associated with Lafarge, earlier said it is unlikely
that importers will be able to bring in competitively
priced imported cement because the rising cost of coal
has affected manufacturers globally.
However,
a ranking trade official said Japan is exporting to
Vietnam at a landed cost equivalent to only about $55
per ton (at P47 to the dollar), which is cheaper by half
than the $112/ton price in the country today.
The
source said the Philippines can only import cheaper
cement from Japan and China because they are the only
nearby countries whose cement industries are still
independent of the big global players that are already
dominant in the Philippines.
Japan is the more viable option, however, because it is also
using American standards just like the Philippines. “So
at zero tariff, the cement from Japan will become much
cheaper,” said the source. |
