RIYADH, 20 July 2005 — The Kingdom has decided to reduce customs duty on cement from the current level of five percent to zero percent within six months as part of a major move to check the rise in cement prices by liberalizing imports.
This was announced by Minister of Commerce and Industry Dr. Hashem Yamani at the meeting of the board of directors of the Saudi Arabian Standards Organization (SASO) held yesterday under the chairmanship of Dr. Yamani.
Speaking to newsmen after the meeting, Dr. Yamani said that from October this year till March next there will be a 30-40 percent additional increase in cement production to overcome the shortfall. “This should help meet the demand, “ he said, adding that the move had become necessary to check black market in cement.
The minister clarified that it would, however, be a short-term measure and cement duty would return to the existing level of five percent after six months as in the other Gulf states to stabilize the market.
The government had earlier slashed customs tariffs on cement imports from 20 to five percent in an apparent move to bring down soaring prices in the market.
Dr. Yamani also referred to some illegal practices in the market that were responsible for the cement shortage.
“But we have made arrangements with the governorates, provinces and municipalities to provide cement to people who have licenses.”
The minister said the government would also encourage big companies to import clinker from abroad to produce cement locally. “Contractors have welcomed the government’s intervention reducing the customs duty.”
Currently the market is divided into two segments; one that sells a bag of cement for SR14 per bag to buyers with permits and the other that sells it for SR18 in the black market for buyers without a permit.
Asked about the progress achieved so far on the road to WTO membership, he said one of the decisions approved by the board in line with the requirements of accession to the WTO was to update the technical work directory of SASO in conformity with WTO requirements. The decision was taken in the light of the comments received from the member countries of the WTO. He paid tributes to the SASO team involved in the project.
In reply to a question, the minister said: “We have concluded agreements with several countries. Today the technical negotiating team is planning to visit Geneva on Monday to prepare the final draft of the technical team’s report. There will be several meetings in Geneva during which the Commercial Council of the WTO will take a decision,” he said, expressing optimism about the outcome of the deliberations. Asked if a decision on the Kingdom’s application would not be scuppered by any last-minute hitch from the US, the minister replied that this time the decision would be final.
On the question of meat imports, he said the government has always been in favor of lifting the embargo on meat imported from some countries.
He referred to the government’s decision to lift the embargo on Belgian meat, since their meat shipment conforms to government specifications.
The Commerce Ministry had slapped a ban on the import of chilled, frozen or canned poultry meat from the EU on the grounds that they may be contaminated with the hormones MPA and Ostradil. This ban was in addition to that in place on the import of bovine meat and mutton from all EU states, including Belgium.
