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Safeguard duties on imported glass should be retained for another three years, according to the Tariff Commission, to give the country’s sole manufacturer more time to boost its competitiveness.
In a report released at the close of a formal investigation, the commission said not doing so would mean a flood of low-priced imports that would hurt locally based AGC Flat Glass Philippines, Inc.
The manufacturer’s legal counsel yesterday said they welcomed the finding even as the original petition was for a four-year extension.
"Should the safeguard measure be terminated, China and Indonesia, because of their proximity to the Philippines and their sufficient freely disposable production capacities, and as major sources of imports since 2002, pose a threat to the domestic industry as exports to the Philippines is likely to increase substantially," the report, dated Nov. 20, stated.
"If safeguard measure is removed, AGC Flat Glass will be forced to price its [goods] even below its cost to protect its market share which will further worsen the financial condition of [the firm]. There is a threat of recurrence of serious injury if the safeguard measure is not extended," it stated.
The report went on to attest that the glass manufacturer was complying with commitments to improve operations to eventually compete against imports.
The commission advised the Trade department to continue imposing duties on clear and tinted float glass -- P3,583 and P4,526 per tonne, respectively, which is to be lowered by 5% each year until December 2012.
For duties on figured glass, the same mechanism was also recommended for a three-year period subject to a review in early 2010 to check whether AGC Flat Glass had resumed production of this variant. Failing this, the safeguard measure should be revoked, the commission said.
The firm stopped producing figured glass in November 2007, prompting the Trade department to suspend safeguard duties on this product which at the time stood at P2,274 per ton.
The local glass industry should be protected, said the commission, as it provides the exclusive benefits of employment and after-sales guarantees.
Sought for comment, the firm’s legal counsel Jose Salvador M. Rivera, Jr. said in a telephone interview: "We asked for four years ... But I think three years is all right. After three years, we can ask for another extension."
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