Malaysia halts safeguard probe into Indonesian ceramic products

Jakarta The Malaysian Ministry of International Trade and Industry (MITI) officially halted a safeguard investigation into Indonesian ceramic floor and wall tiles on January 11, 2021.

"The safeguard investigation was halted only four months after it commenced on September 13, 2020. The Malaysian authorities decided to stop the investigation on three considerations," Indonesian Trade Minister Muhammad Lutfi said in Jakarta on Monday.

First, there was no absolute rise in import volume during the investigation period, he said. Second, the impact of import volume hike on Malaysian ceramic products could not relatively be ascertained, he added.

Third, the Malaysian authorities could not ascertain the linkage between an import surge and serious losses suffered by Malaysian ceramic producers, he continued.

The ceramic products that are exempt from safeguard duties belong to HS codes 6907.21.21, 6907.21.23, 6907.21.91, 6907.21.93, 6907.22.11, 6907.22.13, 6907.22.91, 6907.22.93, 6907.23.11, 6907.23.13, 6907.23.91, and 6907.23.93. Malaysian ceramic manufacturers have claimed that there was a surge in ceramic imports which resulted in losses or potential losses for the domestic ceramic industry.

The safeguard investigation was launched in September, 2020, based on a petition from the Federation of Malaysian Manufacturers – Malaysian Ceramic Industry Group. However, the Malaysian authorities could not find evidence supporting the claim.

The investigation was then terminated without the imposition of temporary safeguard import duties.

According to the Central Statistics Agency (BPS), Indonesia's ceramic exports subjected to the investigation were valued at US$7.12 million in 2019, a decline of 27.21 percent compared to exports of US$9.78 million a year earlier.

In the January-November, 2020 period, Indonesia exported US$8.35 million worth of ceramic products, an increase of 24.41 percent compared to exports of US$6.71 million the year before.

Indonesian ceramic products, which have very competitive quality, are believed to have the potential to disrupt the performance of the Malaysian ceramic industry. Indonesia is also one of the main suppliers of ceramic products to Malaysia.

"Statistical data of Malaysian imports in 2019 shows Indonesia was ranked second after China as the largest country of import origin for Malaysia. The MITI's decision creates large opportunities for Indonesia to increase ceramic exports to the neighboring country," Minister Lutfi said.

Source: Antara News

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