Thousands of workers in the local petrochemical industry may lose their jobs if the smuggling of imported petrochemical plastic resin goes on unabated, a spokesman for the industry warned yesterday.
Willie Paras, chairman of the Association of Petrochemical Manufacturers of the Philippines (APMP) said that local sales volumes have gone down due to the proliferation of cheap smuggled items which escape tariff payments.
"If sales volumes continue to decline as a result of smuggling, companies will have no choice but to cut production," said Paras. This, he added, will consequently result in layoffs for workers. This industry employs approximately 250,000 individuals.
This scenario, he said, "must not be allowed to happen," thus, the need for government to crackdown on smuggling, particularly those conducted using Customs-bonded warehouses (CBWs).
CBWs are allowed by law to import raw and semi-processed materials duty and tax-free as an incentive to legitimate manufacturers engaged in exporting at least 70 percent of their output. However, some unscrupulous CBW operators have been importing plastic resins tax and duty-free and selling these products in the local market.
Such illegal activities have deprived government of an estimated P572 million in lost revenues for last year alone.
Paras pointed out that the domestic petrochemical industry, composed of Bataan Polyethylene Corp., D&L Industries, JG Summit Petrochemical Corp., Petrochemicals Corp. of Asia and the Pacific, Philippine Resins Industries Inc., and PNOC Petrochemical Development Corp., generated 5,000 additional jobs for last year alone.
"It would be sad to see Filipinos losing their jobs and the means to support their families due to the illegal activities of smugglers," he said.