T

he Trade Ministry has submitted its recommendation to the Finance Ministry for the imposition of up to 74 percent anti-dumping duties on imported cold rolled coil and cold rolled sheet to protect local industry from unfair practices.

Trade Minister Gita Wirjawan said on Wednesday in Jakarta that the move had been taken in response to unfair trade practices conducted by a number of foreign producers.

“Our interest is not limited to steel and cold rolled coil but also other products that boost our domestic production capacity,” Gita told reporters after launching a consumer supervision system at his office. “This must be of our concern.”

In the recommendation, as requested by the Indonesian Anti-Dumping Commission (KADI), the Trade Ministry has proposed an anti-dumping duty for producers from five countries: China, Japan, South Korea, Taiwan and Vietnam.

The lowest import duty of 5.9 percent will be levied on SYNN Industrial of Taiwan, while the highest tariff of 74 percent will fall on several Chinese companies such as Strip Co. Ltd.

Dumping, in which a manufacturer sells its products in other countries at lower prices than it charges in its home market or below its production costs, is categorized as an unfair trade practice by the World Trade Organization (WTO).

Under the rules of the world trade governing body, member nations are allowed to charge anti-dumping duties, which are levied in addition to regular import tariffs to offset dumping.

A dumping measure can be for a maximum of five years and can be extended after a review carried out on its expiration.

KADI began its investigation into the cold rolled coil and sheet case in June 2011 following a request filed by Indonesia’s biggest steel maker Krakatau Steel, which claimed it suffered sizeable losses from unfair competition in which imported products were sold at lower prices in the local market.

Based on its investigation, the commission found strong evidence to support the allegation that imported cold rolled coil and sheet are dumped onto the local market, causing injury to the petitioner.

Krakatau Steel president director Irvan Kamal Hakim said on the same day that if approved, the imposition of the anti-dumping duties could help the company compete fairly with foreign products.

“We expect the Finance Ministry will act [based on the recommendation]. It will surely compensate for our losses,” he told reporters before a meeting at the Industry Ministry’s office.

Indonesia has stepped up its fight against steel-dumping from foreign countries as the local market has been flooded by foreign steel items amid lessening demand from Europe.

In October last year, the Finance Ministry imposed anti-dumping duties on hot-rolled iron and steel plate from China (10.47 percent), Singapore (12.33 percent) and the Ukraine (12.5 percent) following a recommendation from KADI after it had investigated this issue.

Previously, KADI stated it would ask the government to impose anti-dumping duties of up to 68 percent on imported cold rolled coil and sheet steel to stop dumping.

Imposition of the duties was needed to aid local steel producers, who were a strategic industry for the nation, it added.