Press Releases

On Tariff Commission’s decision to not extend safeguard duties on imported cement

October 9th, 2022

Rep. Joey Sarte Salceda – 9 October 2022

I am the principal author of Republic Act 8800 or the Safeguard Measures Act. The point of that law is to mitigate the harms to the domestic sector of a surge in imports. Safeguard measures were already implemented on Ordinary Portland Cement Type 1 and Blended Cement Type 1P in 2020 and 2021.

With the domestic cement sector recovering its profit levels back to P13 billion, around what it was earning pre-pandemic, there is strong grounds for the Tariff Commission’s decision that the safeguards no longer be extended.

Construction was a big loser of jobs in the August Labor Force Survey. The sector lost 258,000 jobs. High costs of inputs such as cement due to higher import costs would kill even more jobs in that sector.

Around 16% of total infrastructure project cost is cement. The safeguard duties of P40 per 40-kg bag were effectively a 15% surcharge on the price of imported cement. So, the non-extension also saves the government’s infrastructure program around P28 billion. As Chair of the House Committee on Ways and Means, I would struggle very hard to find a source for that kind of money.

Overall, I think it’s a sound decision. The most important intervention we can make for the local cement sector is not protection from global trade, but lower power costs. Cement manufacturing is heavy on electricity costs. Unnecessary trade protection will only prevent the industry from acquiring the kind of discipline necessary for competitiveness.

I still think at some point we can revisit safeguard duties on imported cement when there is serious possibility of harm. For now, the Tariff Commission’s decision has strong merit.

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