GPCA: Egypt to respond on PP duties

12 September 2012 10:57  [Source: ICB]

Egypt's Ministry of Industry and Foreign Trade is expected to respond in October to a report that argues against a 15% import duty imposed by the country on polypropylene (PP).

The report, submitted by a group of Gulf Cooperation Council (GCC) petrochemical producers to the Egyptian government body on 3 September, is a summary of arguments first presented by the GCC producers in a public hearing held on 22 August, attended by both importing and local PP producers.

According to GPCA, this safeguard measure is not in compliance with WTO rules and regulation and is counterproductive for the Egyptian conversion industry which lobbied against imposing such a measure.

GCC PP offers into Egypt have become unattractive to buyers after the Egyptian government imposed an import duty on PP resins for a period of 200 days from 5 June.

"We presented our final argument to the body, and we are waiting for them to respond. They are going to reply to all interested parties [between the] beginning and the middle of October; after that they will give us a chance to respond," said one GCC PP producer.

The GCC report argues the data presented by local authorities on import figures are exaggerated, the producer said. Second, a claim that both India and China have undertaken a similar course of action against the GCC countries is incorrect and unsupported by any qualifying data.

Finally, the report argues that local production alone cannot satisfy all the PP consumption requirements in Egypt, the producer said. "They are going to kill all downstream business," the source added.

A second GCC PP producer that regularly exports to Egypt attributed the import duty to the rising cost pressures on Egyptian producers from loss of feedstock from Libya.

By: John Baker
+44 20 8652 3214

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