By Claude Mills, Staff ReporterHEAVYWEIGHTS in the cement industry exchanged verbal salvos yesterday as the public war of words fought in newspaper ads spilled over during a public hearing hosted by the Ministry of Finance and Planning on bound rates for cement.
The members of the Government in attendance were Finance and Planning Minister Dr. Omar Davies; Technology Minister Phillip Paulwell; Minister of Industry and Tourism Aloun Assamba; Minister of Development Dr. Paul Robertson and Minister of Water and Housing Donald Buchanan. Members of the Opposition Jamaica Labour Party (JLP) failed to show up to participate in the discussion.
However, this did not deter the major stakeholders from duking it out during the hearing. Rollin Bertrand, Group Chief Executive Officer at Trinidad Cement Ltd., said there would be a drain of "$50 million in foreign exchange if we were to import all of our cement requirements".
"A local industry would save approximately 50 per cent of this drain," Dr. Bertrand said.
NO MORE PRICE INCREASES
He promised that there would be no more price increases during the upgrade. "The bound rate is the only immediate WTO remedy available. If not implemented, the viability of the Jamaican cement industry will be jeopardised," he said. "And given the huge dumping/subsidy margins, I believe 50 per cent is where we should go to," he concluded to loud applause.
He was referring to the recent proposal by Government to move to 50 per cent, the tariff on imported cement. This, with a view to protecting the local-based Caribbean Cement Company Ltd. (CCCL) from dumped cement. The move has met with stiff opposition from private importers who argue that the decision was promoting a monopoly and would result in increased cost to consumers.
The parliamentary Opposition has not supported the move.
There was also a presentation made by Roderick Gordon, the attorney-at-law representing Mainland International, a major cement importer, reiterating the company's anti-bound rate stance, and highlighting the positive impact the company has had on cement prices.
Asked by a reporter why his company had not chosen to withdraw in solidarity with its fellow importers (Arc Systems Ltd., and Jamaica Cement Consortium), Jeff Myrie, chairman of Mainland International Ltd., responded:
"We spent a lot of valued time to get the Minister to talk to us, at this point, it is difficult to withdraw. We have the most to lose, we will definitely have to lay off people if this goes through. I will fight to the end."
Mainland International employs over 1,000 people, almost 200 of whom are directly tied to the company's cement business.
The Government is currently reviewing its decision to raise the Common External Tariff (CET) from 15 to 50 per cent on Portland Grey Cement in order to provide some amount of protection to the CCCL from 'dumped cement' from overseas countries.
Don Mullings, of the Incorporated Masterbuilders Association of Jamaica, commended CCCL on the turn-around of the company's performance which realised $526 million in profits in 2002.
However, he remained opposed to a CCCL monopoly in the local market. He said the company had had to revert to importation to satisfy the local market for three of the last four years, and that it had never produced at its full capacity.
"The CCCL would be unable to satisfy future demands without importation," Mr. Mullings said.
Dr. Davies announced that a decision is expected to be made soon once a report was presented to Cabinet and deliberations made.
