CAIRO - Producers, on one hand insist that opening the door wide for importing rebar is likely to damage an old, national labour-intensive industry, not to mention deplete the state stock of foreign reserves. On the other hand, however, importers say allowing free rebar imports is the "boogeyman" feared by local companies, arguing that consumers are the beneficiaries after all. There is an urgent need to promote the emblem "made in Egypt," encouraging the Egyptian people to buy national products since they are of good quality and suitable prices, Wafiq el-Dhao, owner of a rebar plant, said. He added that rebar imports will further drain foreign reserves, which have already dropped from $36 billion (at the end of 2010) to the current level of $13.6, Consequently, banks are restricting their use of documentary credits to importing strategic food stuffs. "Since rebar has a local alternative, banks refrain from financing imports, but leave it up to importers to obtain foreign money their own way, of course from the black market" el-Dhao said, expecting the dollar to rise higher over the coming period. El-Dhao stressed that the price of Turkish rebar at home is much higher than it is in Egypt, and the aim is "to damage the Egyptian [rebar industry]", he told the Arabic daily Al-Ahram. Another famous producer, Ahmed Abu Hashima, said that damaging the national rebar industry means driving scores of hundreds of workers to the street. According to Abu Hashima, investments in the local rebar industry hit about LE 80 billion ($11.76 billion). He also said that the industry came to suffer more burdens, namely the rise of energy and water as well as other services offered to the rebar plants. In addition, wages have risen by 100 per cent over the past months. Thus, the price of a tonne is LE4,775 ($702), and is delivered to traders at LE 4,940 ($726). Abu Hashima quashed what Namik Ekinci, Chairman of the Board of the Steel Exporters in Turkey, told the paper recently; namely, that the production of a tonne of rebar in Turkey is higher by LE544 ($80) than in Egypt. On the decision taken weeks ago imposing LE300 ($44), dumping fees for a tonne of rebar imported from Turkey, he said it is nothing new. "Turkey itself imposes 15 per cent dumping fees on a tonne of rebar imports from Ukraine. In the meantime, Abu Hashima said that only LE 102 million ($15 million), with 15 of the top 200 people employed in the activity, which is too little compared to the huge investments in the industry. "Importing iron, from Turkey, or anywhere else in light of the rising dollar rate of exchange and the currency rarity, is a 'crazy adventure', Wanis Ayyad, a producer, said. Traders interviewed by the paper supported the view, saying that there is no need for imports since the local industry can meet the needs of the market. On the other hand, Ahmed el-Zeini, head of the Building Materials Section at the Cairo Chamber of Commerce, said it is necessary to open the door wide for importing iron. "Rebar imports are the boggeyman of local producers so as to prevent any monopoly. Consumers benefit from the competition," el-Zeini said, noting that rebar imports fell sharply from 25 million tonnes in 2009 to 324,000 tonnes in 2012. Since the application of the dumping fees last December, a tonne of local rebar rose by LE1,200 ($176), though the relevant crude materials saw no rise. According to el-Zeini, local production hit seven million tonnes in January 2012 when a tonne reached LE3,300 ($485), compared to the current price of LE5,500 ($809). He stressed that rising prices of rebar and cement came at a time when the construction market is already suffering a recession, in a sector that employs up to 4 million people. Namik Ekinci, Chairman of the Board of the Steel Exporters in Turkey, told Al-Ahram recently that we did not have "the least" intention to harm Egyptians. "Our aim is to enhance productivity and competition. But imposing dumping fees of 6.8 per cent on the rebar imports from Turkey is unfair and violates the free exchange agreements signed between Egypt and Turkey on one hand, and the World Trade Organisation on the other," Ekinci said in his statements.
