DTI agrees to mediate Global Steelworks issue

The Department of Trade and Industry (DTI) has agreed to mediate between Global Steelworks International Inc. and the consumer groups complaining about the quality of the steel the firm produces.

“There are some quality issues and we have to address that,” Senior Trade Undersecretary Thomas G. Aquino said in an interview.

According to Aquino, they have received complaints from the Filipino Galvanizers Institute Inc. (FGI) regarding the quality of the hot rolled coils (HRC) and cold rolled coils (CRC) being produced by Global Steel.

“There is a move that we are trying to do which is to get Global and its customers that indicated concerns for quality to come together. It’s a business to business issue and it should be settled by the buyer and the maker,” Aquino further explained.

In spite of the questions in the quality of steel the company is producing, Aquino said they will not reversee their decision to certify that the Iligan Plant of Global Steel has achieved commercial operation. The certification has paved the way for the government to grant the request of the company to increase tariff on steel.

“The DTI has made it clear that one has nothing to do with the other. It’s a quality issue, a domestic issue so our regulatory agencies will have to address that, that (on Global Steel being fully operational) is a legal issue,” Aquino noted.

“I made it clear to everybody that the recommendation stands, there is no relation. One is quality and the other is quantity, that is up to the customers not the government,” he added.

Global Steel has figured in several controversies these past months including the alleged plan to sell its Iligan plant and faking documents.

It has already denied rumors they are selling their Iligan plant to another Indian firm the Tata Group.

“That is not true. We are not for sale,” Sangram Mohanty Global Steel’s head of corporate communications said.

However, industry sources reveal that the two Indian firms are discussing Tata’s bid to acquire Global Steel. “They are in serious negotiations,” the source said.

The embattled company has been in the news recently after the Vietnamese government has accused it of using forged and fake documents in order to avail of the zero percent tariff. The discovery has led to the revocation of duty free privileges and the imposition of a seven-percent duty on CRC from the Philippines.