Safeguard duties protect local jobs – DTI

MANILA, Philippines — The Department of Trade and Industry (DTI) yesterday stressed the imposition of safeguard duties on vehicle imports is intended to protect local employment.

“Safeguard duty is definitely meant to help and boost local manufacturing revival efforts and meant to protect local jobs in the manufacturing of cars and light commercial vehicles (LCVs),” Trade Secretary Ramon Lopez said in a Viber message to reporters.

Last Monday, the DTI announced the imposition of safeguard duties in the form of cash bond amounting to P70,000 for every imported passenger car and P110,000 for every imported LCV as it found in its evaluation of a petition from labor group Philippine Metalworkers’ Alliance that increased vehicle imports had caused serious injury to the domestic industry.

The safeguard duties would be in effect for 200 days from the issuance of a Bureau of Customs order, and while the case is under formal investigation by the Tariff Commission to find out if the measure should be in place for a much longer period.

Chamber of Automotive Manufacturers of the Philippines Inc. president Rommel Gutierrez said earlier the move would derail the automotive industry’s recovery as it leads to further decline in sales which could pose risk to local employment.

Association of Vehicle Importers and Distributors Inc. president Ma. Fe Perez-Agudo said the move would not encourage investments nor create jobs in the country.

In response, Lopez said the claim that provisional safeguard duties could lead to job cuts shows automotive firms are selling more imported cars than locally manufactured ones.

From close to 100,000, he said there are currently 86,000 jobs in local vehicle manufacturing including makers of auto parts, metal works, plastic and wiring harness.

“These jobs have been affected adversely by the increasing vehicle imports,” he said.

He said the country’s imports of completely built units jumped to 274,847 in 2019 from just 88,013 in 2010.

Through the imposition of safeguard duties, he said the government is providing a balance.

“Consumers have the option, and the dealers can now sell more of the locally made vehicles such as Toyota Vios and Innova and Mitsubishi Mirage and L300, the prices of which are not changing and therefore will be more attractive. Dealers will still have their businesses,” he said.

He added the safeguard duties are in keeping with the law.

Under the Safeguard Measures Act, the government can impose safeguard measures or higher duties when the surge in imports is found to hurt local players producing the same products.

“If we don’t impose this safeguard, after finding injury to local industry, then we are risking the jobs of the Filipino workers,” Lopez said.

For its part, workers’ organization Sentro ng Nagkakaisa at Progresibong Manggagawa (SENTRO) welcomed the DTI’s move, noting it would protect the local automotive industry’s workers as the surge in imported vehicles in the past couple of years has resulted in loss of jobs and threatens the employment of many more workers.

“In 2019 alone, more than 1,000 automotive workers have been laid off by car manufacturers and their supply chains. Considering that due to the COVID-19 (coronavirus disease 2019) pandemic the Philippine economy is the worst hit in Asia if not the world, the protection of Filipino jobs is vital and cannot be overemphasized,” SENTRO said.