Wilfredo Paras, chairman of the Association of Petrochemical Manufacturers of the Philippines (APMP), said close to $1 billion in investments in the local petrochemical industry are endangered, in addition to the scuttling of plans to set up a $600-million naphtha cracker plant, which could draw in more investments in various petrochemical industrial lines estimated at $745 million.
Paras said the lowering of tariffs mandated by the CEPT-AFTA may also cause the loss of jobs of about 6,000 workers and professionals dependent on the petrochemical industry.
According to him, the local petrochemical industry is still in its infancy stages, having been established only in 1998, as compared to the petrochemical industries of other AFTA members which have been in operation for as long as 20 years. "The petrochemical industries of most of our ASEAN competitors have been maintaining tariffs of as high as 40 percent for decades, giving them all the time and leverage to develop and mature. Thus they could now afford to lower their tariffs even to five percent," he explained.
In the case of the local petrochemical industry, he said tariff started at 10 percent in 1998, and was slightly increased to the current 15 percent. He said the industry cannot survive any more lowering of the current tariffs, as imported resins and plastic products already corner about 43 percent of the market, while smuggling eats up about 18 percent of the local market.
During the forum, Bobby Sison, general manager of Metalcast Corp., a parts suppliers to the motorcycle industry, also reported of the dramatic increase of cheap motorcycle imports from China from 2,500 units in 1999 to 60,000 units at present, which is a third of the annual local total demand. He also complained of massive smuggling of motorcycles.
"With more tariff reductions, the local motorcycle industry will die by the end of the year," he said, "dislocating about 20,000 workers and local businessmen."
Carlito Rallistan, president of the Association of Democratic Labor Organizations (ADLO), said it is time for both workers of industry to confront decisively the common threats to their jobs and enterprises, and has called for a series of mass actions to press government for a moratorium on tariff reductions and import liberalization.
During the forum, the leaders of the workers, farmers groups and industry agreed to hold a mass action on Aug. 5 in time for a top-level meeting of AFTA economic ministers at a hotel at the Ortigas Center, Pasig City. They also agreed to come up with a common and coordinated program of action to press for their demands.
Among the prominent business and civil society leaders present during the forum and expressed support to the mass actions were Meneleo Carlos, president of the Federation of Philippine Industries (FPI), former senator and FTA head convenor Wigberto Tañada and Princess Nemenzo, among others.