According to FGI president Salvio Perez, "GSII cannot meet the quality requirements of domestic galvanizers utilizing continuous hot-dipped galvanizing process."
Perez explained that most galvanizers have complied with government’s mandate to modernize their facilities in line with the country’s commitment with the World Trade Organization (WTO) and in answer to government’s call for local enterprises to be globally competitive.
Perez added that local galvanizers have invested more than P14 billion in modern and state of the art facilities which have allowed them to export their products to the US, South America and to other countries in Southeast Asia.
Perez warned that the galvanizers’ investments would "go to naught if the local galvanizers will be forced to buy poor quality and non-competitive steel products from GSII."
The FGI further complained that GSII has not established commercial operations as it claims.
GSII earlier announced that it is now in full commercial operation which is supposed to trigger government’s commitment to provide its products – hot rolled coils (HRC) and cold rolled coils (CRC) with a tariff protection of seven percent.
The FGI argued that "the tariff increase on HRC and CRC will aggravate the already distressed condition of the steel industry and burden users of these products in the form of higher prices for the sake of one foreign-owned company that has yet to prove its capability to supply the quantity and quality requirements of the local industry."
The FGI stressed that the inability of GSII to deliver orders of some FGI member- companies and other users "is a clear manifestation that GSII is undeserving of any tariff protection at this stage."
GSII claims that it has spent $30 million to rehabilitate the former National Steel Corp. (NSC) plant in Iligan, Davao.
However, a former NSC official doubts GSII’s claim, pointing out that if $30 million had indeed been spent on the Iligan facilities, GSII should be producing steel products comparable with the products produced by old steel mills in Indonesia, India and China.
Instead, the FGI members have complained that GSII’s CRC products have very limited product applications and cannot be used for pre-painted roofing, general fabrication, vehicle assembly and appliance product applications.