06 January 2010 11:32 [Source: ICIS news]
LONDON (ICIS news)--The South African government has lowered import duties on many plastics by a further 1.3 percentage points, market players reported on Wednesday.
Imported volumes of polyethylene (PE), polypropylene (PP) and polyvinyl chloride (PVC) would be subject to duties of 2.5% from 1 January 2010, sources said, falling from the 3.8% bench that was set in August 2009, when import duties were reduced from 10%.
The reasons behind the further reduction were unclear, although a key trader in the region said: “The reduction brings South African import rates in line with other regions in a preferential trade agreement. The government wants to stimulate some international investment.”
The source added: “There will be no impact on the market, but local producers will come under further pressure to adjust prices if they want to remain competitive.”
However, it was widely reported that domestic producers would be unable to lower prices further as margins were already unsustainable.
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