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Vietnam asks to be excluded from Philippines' probes on polyethylene pellets

12:38 | 28/09/2020

The Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade has sent the consultation letter to the Philippines’ Department of Trade and Industry asking it to exclude Vietnam from the safeguard investigations on polyethylene pellets and granules.

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In the letter, the Trade Remedies Authority of Vietnam expressed concern about the Philippines’ initiation of safeguard investigations on polyethylene pellets and granules imported into the country, including high-density polyethylene (HDPE) and linear low-density polyethylene (LLDPE), Thanh Nien reported.

Vietnam requested the Philippines to strictly abide by rules for safeguard investigations of trade defense measures in accordance with the World Trade Organization’s safeguard agreement.

vietnam asks to be excluded from philippines probes on polyethylene pellets
Illustrative photo: Tapchicongthuong

Moreover, the volume of Vietnamese HDPE export to the Philippines was 161 tons in 2018 and 24 tons in 2019. Vietnamese LLDPE export to the Philippines was 74 tons in 2016, 50 tons in 2017, 85 tons in 2018, and 60 tons in 2019. Hence, Vietnam is eligible to be excluded from the probe according to the safeguard agreement of WTO.

The Trade Remedies Authority of Vietnam recommends the Vietnam Plastic Association as well as resin manufacturers and exports to actively get updated the situation and closely cooperate with the authority to receive timely support.

Previously, The Philippines Department of Trade and Industry (DTI) announced that it would look into the imposition of safeguard measures on resin products after receiving a claim from JG Summit Petrochemical Corp. (JGSPC) that it has been harmed by unfair competition from imports, Business World reported.

According to the application filed by JGSPC, the Philippines has been importing increased quantities of High-Density Polyethylene (HDPE) and Linear Low-Density Polyethylene (LLDPE) pellets and granules from various countries. JGSPC said that a surge in imports caused substantial injury to the industry.

HDPE is used in consumer and industrial packaging, and LLDPE is used for general purpose bags and laminated films.

vietnam asks to be excluded from philippines probes on polyethylene pellets
Illustrative photo: Hanoimoi

The Trade department after reviewing the application said there is evidence justifying a preliminary investigation into safeguard measures. Trade Secretary Ramon M. Lopez signed the notice of investigation on Aug. 28.

The department’s initial reports found that there was a significant increase in imported HDPE from 2015 to 2019, which preceded the industry’s loss of market share. HDPE imports increased by 181% in 2016.

The industry also saw a decline in sales, production, utilization rate, labor productivity, and production costs as well as more losses and inventories.

“The conditions of the competition showed that the market share of the domestic product decreased during the (period of the investigation) from 78% in 2015 to 53% in 2019, as the share of imports in the domestic market significantly increased,” according to the report.

Within ASEAN, resins including HDPE and LLDPE are charged zero tariffs.

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