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Cement demand improves in the Philippines, but producers want more support

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World Cement,

Improving market conditions in the Philippines have encouraged Taiheiyo Cement Philippines, Inc. to increase investment in manufacturing facilities, the company’s president and CEO Satoshi Asami, told local press. “In the last two years, our company has already poured in P250 million in investment and we expect to invest an additional US$10 million in the next two years to cater to the growing demand of cement in the country,” he said in an interview last week.

Taiheiyo Cement Philippines’, Inc. has an existing capacity of 1.5 million tpa, having spent P150 million (US$3 million) over the last year expanding capacity by 15%. With the ongoing expansion, this is set to increase again in 2014.

Total demand in the Philippines amounts to about 18.4 million tpa of cement. The growing economy, significant investments in infrastructure and the country’s positive reputation amongst international investors are all fuelling construction growth and cement demand. Asami said his company is aiming to prepare for demand growth by expanding now.

He added that improved conditions for Foreign Direct Investment, such as those adopted in Vietnam and Indonesia, would encourage even greater investment from foreign companies.

Protection and support for the cement industry

Meanwhile, the cement industry has called for the Trade Department to level the playing field by including all investments of integrated cement plants under the Investment Priorities Plan. They claim there is a lack of support for an integrated industry, which could ultimately result in a loss of integration and increased vulnerability in the supply chain. The cement sector has also asked the government to consider reducing power costs and increasing import tariffs on non-ASEAN imports to encourage greater capacity utilisation in the domestic sector, pointing out that other countries in the region receive subsidies ranging from 36 – 54% of the true cost of energy supply. Further demands laid out in the cement’s industry’s proposed roadmap include a stricter enforcement of cement quality standards, the rationalisation of transport policy and planning to enhance the expansion of road networks, and the development of port and rail infrastructure.

Edited from various sources by

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