Vietnam ministry cans local petition to regulate glass imports

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A petition by local glass makers to hit imported float glass with higher taxes has been rejected as the Ministry of Industry and Trade ruled the foreign products had not hurt local businesses.

“No safeguards should be applied to the import, as it has not been the main cause of the low production and sales figures of those petitioning for measures against it,” said the ministry in an official decision released on Wednesday.

Viglacera Float Glass Company, Vietnam Float Glass and Vietnam Float Glass Industry filed the petition last summer asking the ministry to protect local producers by imposing an absolute duty rate of US$0.6 per square meters on all kinds of imported float glass.

The ministry said the petitioners had previously posted low production results due to high production costs resulting from spiking oil prices in 2006-2008. It also said counterfeiting had played a role in their low numbers as did the impacts of the global economic crisis.

Oil, which accounts for 30 to 35 percent of production costs at local manufacturers, reached a peak of $140 per barrel in mid-2008 before falling sharply during the economic downturn in late 2008 and early 2009.

However, the ministry said oil prices were now lower and that production at factories was recovering and sales were growing.

In rejecting the lawsuit, the ministry said local manufacturers still held over 80 percent of the market share.

Float glass is a sheet of glass made by floating molten glass on a bed of molten metal, typically tin to serve automobile, construction and civil-purposed industries.

The lawsuit, the first of its kind in Vietnam after the country joined the World Trade Organization in 2007, aimed at imports from 15 countries and territories such as Indonesia, China, Thailand, the Philippines, Japan, Taiwan, Singapore, Malaysia, Korea, India, Belgium, the US, Hong Kong, Switzerland and Australia.

Float glass imports from Southeast Asia currently enjoys a 5 percent tax in Vietnam while other sources have to pay 40 percent.

Local firms that feed their factories float glass opposed the lawsuit, saying the measure would hurt local consumers.

Reported by Minh Quang

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