JG Summit Olefins Corp. (JGSOC) said the decision of the Tariff Commission (TC) not to impose safeguard duties on imported resins puts the local petrochemical industry at a severe disadvantage which may result to massive losses.
“The TC recommendation not to grant safeguard duties on imported linear low-density polyethylene (LLDPE) will be detrimental to the local petrochemical industry and will only benefit foreign resin manufacturers as they continue to increase the volume of their exports of resin products into the country,” said Patrick Henry Go, president and chief executive officer of JGSOC.
JGSOC said it will seek further clarity on the TC’s decision as this runs contrary to its own and that of the Department of Trade and Industry’s (DTI) initial reports confirming there was an increase of importation of this key plastic material within the period of investigation (POI) from 2015 to June 2021.
Go said the “TC report differs glaringly and was a complete turnaround from the DTI’s preliminary findings and even the TC’s own initial report that there was indeed a surge in LLDPE imports during the POI.”
“For many local industries, including the domestic petrochemical industry, to become globally competitive and achieve long-term viability, the support of the government in the form of trade remedies is needed in areas where trade imbalances adversely affect the particular local industry who is still in the process of catching up to foreign competition,” Go said.
In terminating its investigation, the TC said in a summary report dated May 23, 2022 has recommended not to slap definitive general safeguard measures on imported on LLDPE pellets and granules as the products were not imported in increased quantities as claimed by industry.
TC said the output of JGSOC, the sole manufacturer of LLDPE products, complies with the domestic industry requirement and that locally produced LLDPE pellets and granules are directly competitive products to imported ones.
LLDPE is used for laminated films and general-purpose bags. Within the Asean, both raw materials are charged zero tariffs.
