Gov’t steps up enforcement of rules vs auto smuggling
MANILA – The Aquino administration is bent on strictly implementing anti-smuggling rules in the country including the automotive sector to improve the local production of vehicles and create more employment opportunities.
In a speech at the 3rd Philippine International Motor Show, President Benigno Simeon Aquino III has underscored the government’s effort against smuggling activities in the country including automotive smuggling.
Plugging the loopholes over smuggling activities would be a key factor to increase capacity utilization of the local auto assembly and the development of the autoparts components.
Aquino said the motor vehicle industry has an overall capacity of 1.19 million units but only sold 132,000 units in 2009 or a shortfall of one million units.
He, however, said that the industry’s 37 percent increase in sales in the first seven months of the year is a reflection that “we are getting better” adding there developments and opportunities for exports in the region.
Trade and Industry Secretary Gregory Domingo also said cited the need to strictly implement anti-smuggling rules in the country not just for the automotive industry but across the board.
The auto industry has long been advocating against anti-smuggling activities in the country.
Elizabeth Lee, president of the Chamber of Automotive Manufacturers of the Philippines, said there is no need to change or add more anti-smuggling rules but just the strict implementation of the law.
“We only need the strict implementation of rules, because our rules are much stricter than anybody else’s,” Lee said.
Lee explained the need to put a strong word against anti-smuggling in convey a message to foreign investors that the government is clear on its policies.
“We have to impress upon foreign investors that the Philippines market is conducive for doing business,” she said.
She cited the one reason for the high unutilized production capacity is because the entry of smuggled vehicles has been eating up the opportunities of the local players.
The industry’s assembly plant capacity utilization rate is only between 30 to 40 percent.
But Lee also said there is an opportunity for the Philippines to grab some of the expanding capacities because foreign carmakers are adopting the so-called “fragmented production” in the region.
Lee explained that the trend among car companies is to produce in several countries rather than producing in one hub only in the region to cope up with the strong demand in the region.
She said the excess production capacity in the local industry has positioned the Philippines well to become the production hub of some of the car makers’ expanding capacities.
“Asia is the auto market with the greatest potential. It is already the biggest – and the most profitable market in the world. We have the capacity. We have the capability. We have the skills and engineering knowhow. And now, we have the right environment,” she said.
Lee stressed that the auto industry is one of the Philippines ’ few remaining major industries.
“What we have in common with our ASEAN neighbors, is the prohibition of imported used vehicles. Sadly, what sets us apart is the lack of the strict implementation of that ban. Without it, the auto industry cannot achieve its full potential,” she said.
“A stop to smuggling is a green light to a bigger domestic auto market which in turn is a go for immediate job creation,” she said.
“This then is our hope and a wish for a more vibrant auto industry, a bigger auto market, and for more employment,” she said.
Lee also thanked Aquino for prioritizing jobs creation and his firm stand against all forms of corruption, including smuggling.*PNA
