Trade Secretary Manuel Roxas II said in a statement that there is a need to initiate safeguard measures against the importation of figured glass and glass mirrors from various countries to shield local industries from unfair competition.
What we would like to achieve with our efforts is to shield local industries from unfair competition and provide them a level playing field to enhance our products competitive advantage, Roxas stressed.
Figured glass used for windows, partitions, screens, doors and flourescent fixtures are imported from China, Thailand and South Africa. On the other hand, glass mirrors used for wardrobe doors, bathroom, furniture, projection screens, display cases, décorative wall, as well as ceiling and pillar cases are coming from China, Indonesia, Taiwan, Thailand and South Korea.
Based on the petition filed by Asahi Glass, the share of imported figured glass in the domestic market rose to 28 percent as of August last year from only 11 percent as of 1997. On the other hand, the share of imported glass mirrors in the domestic market increased to 51 percent last year from 34 percent in 2001.
The local figured glass market shrunk 72 percent as revenues of local producers retreated by 28 percent to P214 million last year from P345 million in 1997. Also, the production capacity of local producers fell to 72 percent from 93 percent.
The local players also argued that their margins of profits were down from 60 percent in 1997 to only 13 percent last year as most companies suffered net losses since 1998 after posting a net profit of P68 million in 1997. This after importers undercut prices of imported figured glass by 10 percent.
On the other hand, the volume of imported glass mirrors jumped 151 percent last year compared to the volume imported way back in 1997. Local producers of glass mirrors posted higher losses due to price depression at 5 percent of domestic selling price as prices were depressed by 13 percent to be able to compete with imports.
Asahi Glass sought relief under Republic Act 8880 or the Safeguard Measures Act. The law allows the DTI to impose a punitive tariff of as much as 50 percent for a period of 200 days in case of import surge. During the period, the Tariff Commission will decide whether or not it will impose a definitive measure in the form of quota restrictions.
Asahi Glass Philippines is a unit of Tokyo-based Asahi Glass Co. Ltd., the worlds largest producer of flat glass. It has infused P3.8 billion in the Philippines but has decided to close its production line for tempered automotive glass in the country due to low capacity utilization and soft demand.
Asahi Glass Philippines, formerly known as Republic Asahi Glass Corp. (RAGC), operates a manufacturing complex in Barrio Pinagbuhatan in Pasig City with 700 workers. It originally started as Republic Glass Corp. in 1958 and was renamed as RAGC in 1988 when RGC merged with Asahi Glass Co. Ltd. In 2001, the company was renamed Asahi Glass Philippines after the Japanese partner bought out its Filipino partner. L. Agcaoili