RI to file a WTO complaint against RP cement policy

RI to file a WTO complaint against RP cement policy

Adianto P. Simamora, The Jakarta Post, Jakarta

Indonesia is expected to file a complaint with the World Trade
Organization (WTO) against measures imposed by the Philippines on
imported Indonesian cement products.

Hatanto Reksodiputro, the director general of international
cooperation at the Ministry of Industry and Trade, said on
Tuesday Indonesia could not accept the safeguards imposed by the
Philippine government because it had failed to notify the WTO
about the measures.

Furthermore, the Philippine government had not followed proper
procedures in implementing the measures.

The Philippines has imposed safeguard duties on Indonesian
cement products since December 2001 to protect local producers.
The measures were passed following a surge in imported Indonesian
cement.

The Philippines Cement Producer Association (Philcemcor)
claims the Indonesian imports threatened the survival of local
producers.

According to data from Philcemcor, cement imports from
Indonesia reached 369.473 metric tons in 2000, or about 23.4
percent of the total Philippine market of 1.6 million metric tons

And from January to September 2001, Indonesian imports rose
sharply to 944.715 metric tons, or 50 percent of the country's
total market of 1.865 million metric tons.

As a result, the Philippine government imposed an additional
import duty of about 20.6 pesos (1 US cents) per bag of imported
Indonesian cement.

The measure is consistent with WTO rulings which allow member
countries to protect local manufacturers by temporarily raising
import duties on certain products that experience an unexpected
surge in imports.

Before taking such a measure, a country must draft a so-called
safeguard ruling, which becomes applicable only after the WTO has
been notified.

Indonesia is currently drafting such a ruling, while the
Philippines has drafted one but not yet notified the WTO.

The safeguard measure is temporary in nature and has to be
revoked once there is no proof that imported products are harming
local manufacturers.

Hatanto said the Philippine government had not carried out the
safeguard measure according to proper procedures.

"The Philippines must conduct an investigation first and
provide the Indonesian government with the opportunity to comment
before implementing the safeguard measure," Hatanto said.

Such an investigation would determine whether cement imports
had caused serious damage to local manufacturers.

"As a member of ASEAN, the Philippines must also discuss its
non-tariff policy at the ASEAN Economic Ministerial meeting," he
said.

Indonesia and the Philippines are among the six original
members of the Association of Southeast Asian Nations (ASEAN)
countries that agreed to implement the ASEAN Free Trade Area
(AFTA).

The other four original members are Thailand, Singapore,
Malaysia and Brunei.