The introduction of safeguard duties on imported steel concrete reinforcing bar (rebar), steel wire rods and deformed bar in coils will not negatively impact local builders, says Second Finance Minister Datuk Seri Johari Abdul Ghani.
“We have steel mills in the country, so if we allow these goods [to be imported] into the country cheaply, the existing industries in the country will be closed. This we have to defend,” the minister said in response to criticism from the Master Builders Association Malaysia (MBAM).
MBAM said that the imposition of the duties would increase the costs of construction projects, which would ultimately be passed on to the people.
However, Johari cautioned that when dealing with the local economy, the entire ecosystem should be looked at.
“We need to have a balance. So I think what we do is that if the products can be produced locally, we do not see why we have to import,” he said.
On the government’s move to ensure the new taxes would not affect consumers, Johari added that domestic trade, co-operatives and the consumerism ministry would ensure that the supply and demand were taken into account.
Johari said the Government had introduced safeguard duties of 13.9% for steel coils and 13.4% for steel rebars, following the plight of many domestic steel manufacturers, who have been experiencing margin compression or losses, especially due to dumping activities by the mainland Chinese players.
The taxes are expected to stay in play for the next three years until 2020.
In a statement released to the press, MBAM president Foo Chek Lee said that the association is “very disappointed” at the outcome.
“The association is strongly against the imposition of these additional duties for three years until April 13, 2020,” he said.
Despite this, Foo said MBAM and its members continue to hope that the price of steel bars will remain stable and not escalate out of hand due to the absence of the free flow of imported steel.
Foo added the association hopes the government will ultimately allow an open market to decide on the price of steel bar based on “supply and demand”, especially in the case of imported steel. — Bernama