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Philippines eyes reexport of some 600 used cars
Publication Date : 19-02-2013
The Cagayan Economic Zone Authority (Ceza) in the north is considering exporting used vehicles imported into the special economic zone in Sta. Ana town once the Philippine government clamps down on their resale in the country.
Ceza administrator Jose Mari Ponce said the agency was considering exporting to either Africa or Bangladesh some 600 vehicles that arrived in the country after the Supreme Court decision on January 7 that upheld the validity of Executive Order No. 156.
The executive order, issued by then President Gloria Arroyo in 2002, prohibits the importation of used vehicles into the country, with some exceptions.
“We are trying to determine if there is a market in those areas because if this ban becomes permanent, our best option is to have the vehicles reexported,” Ponce said.
He said Ceza would abide by the ruling of the Supreme Court, denying accusations that the continued arrival of shiploads of used cars in the Cagayan Special Economic Zone and Freeport (CSEZFP) was an act of defiance.
“So if the [Bureau of] Customs is now telling its people to stop [processing the latest shipment of used cars], then that is not our concern because ours is a free port, and we are not violating any laws as long as these vehicles stay within the secured perimeter,” Ponce said.
On Thursday, Customs Commissioner Ruffy Biazon ordered its district office in Aparri, Cagayan, which covers the CSEZFP, to stop the processing of the shipment of 200 used vehicles from South Korea that arrived there on February 11.
Biazon said this was a show of respect for the Supreme Court ruling, which, according to him, the agency will fully enforce once it becomes final and executory.
A shipment of about 400 vehicles from Japan is expected to arrive at Port Irene, CSEZFP’s main port, on Thursday, Ceza officials earlier said.
Avert huge losses
“Reexporting is one option that [used car traders] can resort to avert huge losses. Otherwise, if this industry is really shut down, those vehicles will eventually turn into nothing but junk,” said Ponce, a relative of Senate President Juan Ponce Enrile, who was behind the creation of the special zone and free port through the passage of a law.
But even as used-car traders, mainly Forerunner Multi Sources Inc., the petitioner in the recently decided case, were seeking other legal remedies to avert the folding up of their multimillion-peso industry, Ceza has begun looking at alternatives, said Ponce.
“We are now also looking at the worst-case scenario that about 1,000 people will be left jobless if this industry will stop. So we are trying to look for alternative livelihood for them,” he added.
The Automotive Rebuilders Industry of Cagayan (Aric) was not looking at the option of reexporting the imported vehicles.
“It will never lead to that point. We are confident that [the used-car importation] at Ceza will not be stopped because, as we have already stated, this is allowed by Executive Order No. 418, and the [January 7] Supreme Court ruling has not yet decided on the validity of EO 156,” said Aric president Jaime Vicente.
EO 418 was issued in 2005 by Arroyo and modifies tariff rates for used imported vehicles.
“So we have here two conflicting orders—one that [implicitly] allows and one that prohibits. If [the government] implements one, it renders the other inoperable,” he said.
Vicente said Aric’s operations should not be hampered by the recent Supreme Court decision because it did not decide the main issue of the case, but only the validity of the issuance of an injunction.
“The latter order (EO 418) has already been declared constitutional by the Supreme Court with finality; the other (EO 156) is still pending. So which one should prevail?” he told the Inquirer by telephone yesterday.