Gov’t extends glass safeguard duties

The Trade department has agreed to continue imposing duties on imported flat glass for four more years to protect local manufacturer AGC Flat Glass Philippines, Inc. Adjusted safeguard duties will be slapped on imported float glass this month, based on copies of department orders made available to BusinessWorld. Duties on figured glass, meanwhile, will be imposed in the second quarter as long as the firm resumes production of the product by then. The orders — signed by Trade Secretary Peter B. Favila in January and published on February 5 — heeded petitions made in late 2009 by the country’s sole glass pane maker for the government to exhaust the maximum 10-year period for safeguard duties. "The final extension of the definitive general safeguard measure is in the public interest," the department order covering float glass stated. While the company has benefited from years of tariff protection first implemented in 2003, rising fuel and raw materials and cheap imports have affected the industry’s cost competitiveness, the government said. "Thus [AGC Flat Glass Philippines] has not fully realized the full potential of its cost savings from the efficiency measures implemented. It requires more time to undertake the improvements committed in its adjustment plan," the order said. The order covers all imported flat glass except those obtained from countries whose share of total glass imports is less than 3 percent. Thailand, a major exporter, will be affected by the order, which in effect offsets the elimination of tariffs this year under the Association of Southeast Asian Nations (ASEAN) trade in goods agreement. The department ordered that safeguard duties on float glass be retained for four years, gradually being reduced annually. This year the duty should stand at P3,404.64 per metric ton of clear float glass and P4,300.59 for the tinted variant. For figured glass, safeguard duties will likewise be retained for four more years. But the department issued this caveat: the safeguard will only take effect after the Tariff Commission confirms that the firm has resumed production, as promised, after the first quarter. Only then will the Trade Secretary release another directive to implement the extension. The order for figured glass did not specify a duty, noting only that the amount will assume the annually reduced figure from 2006. That year, the Trade department lifted safeguard duties on figured glass when AGC Flat Glass Philippines stopped making the product. — Jessica Anne D. Hermosa, BusinessWorld