The Arawak Cement plant in St Lucy. (FP)
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Arawak Cement Company Limited (ACCL) and its parent company Trinidad Cement Limited (TCL) have filed an application for Special Leave at the Caribbean Court of Justice in order to pursue an Originating Application against the State of Barbados.
The application was filed last Friday, May 11, 2018. The Originating Application claims (inter alia) that the State has contravened several articles of the Revised Treaty of Chaguaramas (RTC).
Primary among these, is the Government of Barbados’ unilateral reduction and/or alteration of the Common External Tariff (CET) on HS 2523.90.00 ‘other hydraulic cements’ from the rate approved by the Council of Trade and Economic Development (COTED).
The companies said this is in contravention of Articles 82 and 83 of the RTC. The companies are contesting that the COTED-approved rate for HS 2523.90.00 ‘other hydraulic cements’ was moved downward from 60 per cent to 5 per cent in 2015 causing distorted competition and promoting unfair trade practices within the Caribbean Single Market and Economy (CSME).
In addition, the companies are seeking a declaration that the Government of Barbados has also contravened article 79 of the RTC by misclassifying imported cement under HS 2523.90.00 – ‘other hydraulic cement’, rather than HS 2523.29.10 - ‘building cement (grey)’.
As it stands, the imported cement from Portugal and Turkey has been and is being marketed as cement for general use as stated on its packaging, and is being sold for the same applications as the locally produced Arawak Cement brand, the companies said in a statement.
ACCL and TCL are asking for the immediate reinstatement of the COTED-approved 60 per cent rate of duty on cement imports classified as ‘other hydraulic cements’; application of the classification of ‘building cement (grey)’ to all imports of general purpose building cement from third States, which are marketed in direct competition to and used in substitution for the cement produced by TCL and Arawak and other regional producers of general purpose ‘building cement’; damages for the total loss suffered by the company dating back to November 2015 and other relief as the court considers just.
Arawak Cement Company Limited is the only local manufacturer of cement in Barbados, adequately satisfying the market demand for over 37 years with an equally long history of investments in the country’s socio economic development.
More specifically, the company has been providing employment and a safe work environment for Barbadians as well as continuously investing in the well-being of communities. Arawak also continues to invest heavily in its plants and in getting more business to the country - last year the TCL Group’s trading arm was relocated to Barbados bringing with it additional USD inflows, and in the same period, the company also expanded its local businesses by offering Readymix and Precast solutions.
The company’s capital expenditure over the past five years amounted to US$12.4 million (BDS$25 million). Also of great significance is that in 2017, Arawak further increased its export volumes, generating over $15 million in hard US currency (BDS$30 million) for the Barbados economy plus another USD25 million (+BDS50million) from the TCL Group´s Trading arm.
Fundamentally, deviation from the policies of COTED - the region’s established body for trade and economic activity, is preventing the country from collecting rightful taxes and duties, and could have long-term consequences for Arawak’s sustainability, manufacturing operations and also for the Barbados economy. (PR)