The Philippine Metalworkers Association (PMA) has asked the Tariff Commission (TC) to exclude from the period of investigation (POI) data of vehicle imports in 2020 in its study of the safeguard duties on passenger cars and light commercial vehicles when both local production and trade were severely hit.
In its comment on the TC report issued last May, PMA said sales in 2020 were abnormally very low due to the new coronavirus disease-19 pandemic that led to the worst recession experienced by the country.
The report is part of TC’s investigation on the imposition of safeguard measures on imported passenger cars and light commercial vehicles. These are now subject of preliminary safeguard duties of P70,000 per unit on passenger cars and P110,000 per unit on light commercial vehicles.
PMA believes the POI should be limited to the years 2014-2019.
“Imports (in 2020) cannot be compared to previous periods….demand for goods and services, especially luxury goods like automobiles is expected to fall during such crises,” PMA said, citing results of the central bank’s consumer expectations survey which revealed that as early as the first quarter, consumers are likely to reduce demand for ‘big ticket’ consumer items like automobiles.”
PMA said both imports and locally produced automobiles were affected by the decline in demand.
“Trade in general fell, and not just in automotive sector. All these considerations were not observed in the period 2014-2019 because the said period was marked by rapid economic growth. This implies then that 2020 is not comparable to the years 2014-2019,” the group said.
PMA said while imports fell in 2018 and 2019, “it cannot be denied that volume of imports increased significantly in the POI especially when 2020 is disregarded.”
TC data showed total imports of passenger cars and light commercial vehicles grew 23 percent in 2014 to 2015, and 57 percent in 2015-2016 and 54 percent in 2016-2017. Even when imports declined by 24 percent in 2017-2018, and by 5 percent in 2018-2019, PMA said over the entire period imports have more than doubled from 103,331 in 2014 to 222,764 in 2019.
“Therefore, the increase in imports in the POI is significant,” PMA said. – Irma Isip
