Philippine exporters of fructose syrup to Indonesia will have to pay safeguard import duty on the product for three years.
The Department of Trade and Industry (DTI) in a statement said Indonesia will impose safeguard import duty on fructose syrup following investigation showing serious losses incurred by a local producer due to increased importation of the commodity.
The policy will, however, have minimal effect on local manufacturers as they only export excess of production, according to DTI Export Marketing Bureau director Senen Perlada.
The Philippines did not even export the product to Indonesia in 2016, 2017 and 2019. In 2018 it shipped 11.12 million metric tons amounting to $1.51 million to Indonesia, according to data from the Philippine Statistics Authority.
Covered by the Indonesia ruling is fructose syrup with Association of Southeast Asian Nations Harmonized Tariff Nomenclature (AHTN) 1702.60.20.
The decision to slap safeguard duty on the product resulted from the investigation conducted by the Indonesian Trade Safeguard Committee (KPPI) upon request of PT. Associated British Budi (ABB), which produces 54% of the total domestic production of fructose syrup.
ABB said the Indonesian market is being flooded by cheap imports of fructose syrup from China, citing data from the Indonesian Central Bureau of Statistics showing an increase in Indonesian imports from 2015 to 2018.
KPPI notified the World Trade Organization Committee on Safeguards on November 13, 2019 and requested all interested parties to submit comments by December 15, 2019.
KPPI reported that during the investigation period, imports of fructose syrup increased significantly and battered ABB’s local market share. This caused the applicant to suffer serious losses including decreases in domestic sales, production, productivity, use capacity, operating profit/loss, and manpower.
KPPI recommended imposing safeguard import duty on imports of “fructose syrup, in dry condition, contains fructose more than 50% by weight, excluding invert sugar” for three years: 24% for the first year, 22% for the second year, and 20% on the third year.