Something fishy

I thought we as a nation have already said no to non-tariff barriers such as qualitative restrictions on imported products in accordance with what the new world trade order requires.

It seems that we are going back to the dark ages, as we protect local products that could not compete with cheaper imported ones by preventing the entry of these foreign produced items, not through higher tariffs but via other means, like additional requirements.

In the case of the cement industry, however, it is not as simple.

The Department of Trade and Industry (DTI) has issued an order (DAO 17-02 as amended by 17-05) that would require cement importers to secure an import clearance certificate (ICC). The same is however not required of cement manufacturers operating integrated cement plants in the country which would import cement.

This, observers fear, would bring back the cement cartel days, when manufacturers-importers have control of supply and price. In 2015, the cartel has caused cement prices to hit as much as P300 per bag.

A graft complaint had, in fact, been filed by a DTI assistant secretary against a DTI undersecretary before the Ombudsman for allegedly pressuring an OIC of the DTI’s Bureau of Product Safety into issuing the questioned DAO.

At present, cement prices are at P197 per bag and this is because healthy competition exist. But not if the DAO is implemented.

Consumer groups have warned that the DAO is a travesty of justice and fair play because it required pure importers to secure the ICC on top of the Product Safety (PS) mark but did not impose the same ICC requirement on manufacturers-importers.

They note that if both are importers and both buy from the same sources abroad cement of the same quality, then why require the ICC only on pure importers and not on manufacturers-importers?

Considering that we are in the so-called “golden age of infrastructure” and the Duterte administration is committed to implementing its P8-trillion Build, Build, Build infrastructure program, we cannot afford to have tightness in the supply of cement and a consequent increase in prices.

Already, the country needs around 600 million bags of cement a year and local manufacturers can’t seem to meet demand. While local manufacturers produce and sell around 600 million bags of cement each year, an additional 120 million bags are imported by both manufacturers-importers and pure importers.

Thus, imports are the only way to supply the needs of the construction industry, both in the public and private sectors.

News reports say that no less than 75 big-ticket infra projects are up for implementation until 2022. Thus, we need a steady supply of cement and other building materials.

The DTI, or the concerned office for that matter, should explain why the DAO was even considered. Because if their concern is product quality, then all imports should be subject to the same requirement. But why only pure importers? Is there more than meets the eye here?

Purely cement importers, especially the small ones, say that the new DTI requirement would impose an unnecessary burden and runs contrary to President Duterte’s commitment to reduce red tape in government and to make it easier to do business in the country.

On July 25, the House committee on good government and public accountability will continue with its investigation into the questionable purchase by the Ilocos Norte provincial government of 115 units of vehicles without the benefit of public bidding.

It is alleged that these transactions are anomalous given that the purchase of the vehicles worth P66.4 million was done using cash advances, without the benefit of public bidding, and using the province’s share from the proceeds of excise taxes on Virginia-type cigarettes which, according to the law, should only be used to benefit tobacco farmers.

Six officials and employees of the provincial government have refused to answer questions thrown at them and they have been held in contempt and detained at the Batasan complex.

But the suspected mastermind, Ilocos Norte Governor Imee Marcos, continues to snub the formal invitation and later subpoena given by the committee chaired by Rep. Johnny Pimentel. She has yet to inform Pimentel if she would appear on July 25.

Only Marcos can shed light on these matters since every original document, voucher, and receipt has mysteriously disappeared from the stockroom of the Commission on Audit (COA) in Ilocos Norte. As already mentioned, the so-called Ilocos 6 have developed amnesia and refuse to answer.

House deputy speakers Sharon Garin and Mylene Garcia-Albano, along with Rep. Bernadette Herrera-Dy, have all called on Marcos to appear and explain the circumstances behind the questionable vehicles procurement.

Garcia-Albano said that Marcos is the best person to enlighten the committee about the cash advances since her signature appears in most of the documents, whose originals have mysteriously disappeared.

She pointed out that Marcos was the one who requested the purchases, signed their approval, certified the appropriation allotments and signed the disbursement vouchers for the cash advances.

Meanwhile, Herrera-Dy said that contrary to Marcos’ claim that there is a hostage crisis at the Batasan, the real hostage is the truth and that only the testimony of Governor Marcos will set the truth free.

For her part, Garin noted that the 70 units of minitrucks that were procured are colorum since they remain unregistered with the Land Transportation Office (LTO). Supposedly of the China-based Foton brand, they were neither manufactured by Foton nor bought from authorized dealers of Foton in the Philippines as confirmed by United Asia Automotive Group Inc. (UAAGI), the exclusive distributor of Foton vehicles here.

In fact, the logo on the minitrucks read “Forland.” According to UAAGI, Foton manufactures light duty trucks, not minitrucks.

The Commission on Audit has questioned the purchase since COA rules prohibit use of cash advances in government procurement.

Also, Republic Act 7171 provides that portion of the share from excise taxes on locally produced Virginia-type cigarettes allotted for Virginia tobacco-producing provinces should be used to promote the welfare of farmers through the implementation of cooperative, livelihood and agro-industrial projects and infrastructure projects such as farm-to-market roads.

Meanwhile, RA 7160 or the Local Government Code requires Marcos to get authority from the provincial board for the purchases. It is also said that RA 9184 or the Government Procurement Reform Act was violated since no actual bidding took place.

For comments, e-mail at mareyes@philstarmedia.com