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Glass maker, importers clash over duties

Post Time:Oct 20,2009Classify:Industry NewsView:466

THE COUNTRY’S sole producer of glass panes yesterday reiterated that safeguard duties on imports should be extended, pointing to a supposed threat of an import surge due to a global production surplus.

Importers and a Thai manufacturer, however, refuted this claim at a public hearing and went on to question the local producer’s compliance with government orders that it take steps to boost competitiveness in exchange for protection.

AGC Flat Glass Philippines, Inc. — formerly Asahi Glass Philippines — had petitioned that safeguard duties on imports, which have been in place for six years, be kept for another four years. The Tariff Commission is holding hearings this week, which kicked off yesterday.

"We have information and reports from our affiliates and Web sites that there are 15 new float [glass] plants in China alone aside from the 70 already operating," AGC Flat Glass marketing manager Caesar B. Azuelo said at the hearing yesterday.

Three more are expected in India as well, Mr. Azuelo said.

"We consider that a threat because China is the biggest exporter, plus [Southeast Asian] countries have their own surplus of production," Mr. Azuelo said. He claimed this would lead to an import surge that would hurt AGC Flat Glass Philippines.

Under the Safeguard Measures Act and its implementing rules, such a threat to a local industry’s operations are among the two conditions that must exist for additional duties to be slapped on competing imports.

But a Thai glass manufacturing firm countered that such a threat did not exist. "Since January up to today, 68 float [glass] lines have been shut down in China alone," Guardian Industries Corp. area sales manager Fuad Al Katiri said at the hearing.

"[This] is causing a bottleneck of supply in this region [and not a surplus]," Mr. Al Katiri said.

Meanwhile, counsels representing Philippine-based importers San Francisco Glass Corp., Comglasco Aguila Glass Corp., and Nitoo brushed aside the local producer’s claims, saying the operation of more plants abroad would not necessarily lead to an overcapacity.

Dumping of the surplus to the Philippines at very low prices, the importers said, would not happen unless the local producer proves that global demand for such products is waning.

AGC Flat Glass Philippines went on to highlight its compliance with a requirement that a plan to boost its competitiveness be implemented — the second condition it must fulfill to continue enjoying protection.

The Tariff Commission, in a report released prior to the hearing, similarly declared that the local producer has complied with this requirement.

But the Thai firm pointed out that some of the local producer’s measures, such as the use of a certain raw material that requires less energy for processing, may be ineffective.

"If you use too much [recycled cullets, the raw material], your raw material cost will go up [thus making the price of your finished product uncompetitive," Guardian public affairs manager Keetawi Malanon said.

The importers, for their part, added that a four-year extension of the safeguard measure may not be needed especially as AGC Flat Glass Philippines has admitted that it had completed 80% of its program in just six years.

The importers also questioned whether the local producer can satisfy on its own domestic demand for glass panes, to which AGC Flat Glass Philippines vice-president for corporate services Ronnie C. Matas replied in the affirmative.

Given the opposing claims of the two sides, Tariff Commissioner Edgardo C. Abon ordered all parties to submit hard data to support their arguments.

The hearing is slated to run until Friday. Based on the hearing and data gathered from other sources, the state agency will make a recommendation to the Trade department, which will issue a decision.

In the meantime, a P3,583 duty is slapped on imported clear float glass, wh

Source: www.bworldonline.comAuthor: shangyi

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