Reynolds still seeking tariff protection

Reynolds Philippines Corp., which is currently closed, continues to seek tariff protection for locally manufactured aluminum products.

According to Jaime Y. Gonzales, president and chief executive officer of Reynolds Philippines, the aluminum firm is opposed to lowering the tariff on aluminum products even if Reynolds has ceased operation.

Gonzales said Reynolds Philippines is "in negotiations with foreign investors who require the restoration of tariff protection similar to the commitment of the government to investors of National Steel Corp. and similar companies."

Gonzales wrote Trade Undersecretary Tomas Aquino, clarifying Reynolds Philippines’ position regarding plans of the government to lower the existing tariff on aluminum products.

During a recent industry consultation with the Department of Trade and Industry, Reynolds Philippines shareholder Antonio M. Garcia had publicly withdrawn his objection to lower tariffs for aluminum products.

Garcia reportedly said that since Reynolds Philippines has shut down, government could go ahead and lower tariffs on aluminum products.

However, Gonzales wrote Aquino to say that Garcia "basically stated that the Reynolds aluminum plant is presently shut down due to continuing losses that the company incurred resulting from the accelerated reduction in tariff committed by the government to its treaty countries and the unabated entry of cheap imports under dubious circumstances."

Gonzales told Aquino that "there is a pressing need to protect Reynolds and the aluminum industry in order for it to be rehabilitated." Reynolds Philippines was forced to shut down its operations in December 2001.

It has since entered into a restructuring agreement with its creditors.

Its major creditor, Land Bank of the Philippines, now has a 36 percent majority control of the closed aluminum manufacturing firm.

Other government financial institutions which have a stake in Reynolds Philippines are the Social Security System with a 2.18 percent, and the AFP Retirement and Separation Benefits System with 0.29 percent.

Reynolds Philippines was established in 1954 by Reynolds International Inc. of the US.

It used to manufacture and distribute aluminum sheets, foil and extruded sections used in the packaging, container, construction, appliance manufacturing and vehicle manufacturing industries.