G/SG/N/8/MDG/6  
20 July 2020 
(20-4988) Page: 1/4 
Committee on Safeguards  Original:  French  
 
  
NOTIFICATION UNDER ARTI CLE 12 .1(B) OF THE AGREEMENT ON SAFEGUARDS  
OF A FINDING OF SERIOUS INJURY OR THREAT THEREOF  
CAUSED BY INCREASED IMPORTS  
MADAGASCAR  
Soap 
The following communication, dated 1 7 July 2 020, is being circulated at the request of the delegation 
of Madagascar.  
 
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In accordance with Article 12.1(b) of the Agreement on Safeguards, Madagascar hereby notifies the 
Committee on Safeguards of a finding of serious injury or threat thereof caused by increased impor ts. 
In accordance with A rticle 12.3 of the Agreement on Safeguards , Madagascar is prepared to hold 
consultations with Members having a substantial interest as exporters of the product concerned . 
The investigation was initiated on 1 4 August 2 019. 
The period covered by the investigation is 1 January 2 014 to 3 1 December 2 018. However , certain 
indicat ors have been evaluated for 2019 on the basis of the data available to the investigating 
authority  to analyse the evolution in imports and its impact on the domestic industry for a more 
recent period . 
1  PROVIDE EVIDENCE, CITING RELEVANT DATA AND THE APPLICABLE PERIOD OF 
INVESTIGATION, OF SERIOUS INJURY OR THREAT THEREOF CAUSED BY INCREASED 
IMPORTS  
The finding of serious injury to the domestic  industry producing like or dir ectly competi tive products 
was the result of an objective and quantifiable evaluation  of all relevant factors having a bearing on 
the situation of this industry.  
i. Rate of increase in imports  
Imports of soap to Madagascar have undergone a sudden, recent, significant  and continuous  
increase , as indicated  in the section on the increase in  imports . It represents  166% in absolu te terms 
and 301% relative to domestic production over the whole period of the investig ation. In 2019, there 
was a further increase of 19% in absolu te terms and 46% in relative terms by comparison with 
2018.  G/SG/N/8/MDG/6  
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  ii. Domestic  market share taken  by imports  
 2014  2015  2016  2017  2018  2019  
Market share of the domestic industry  
(index  base 100  in 2014)  100 73 54 52 43 40 
Market share of imports  
(Index  base 100  in 2014)  100 130 151 154 163 167 
The above table highlights the domestic industry 's decrease in market  share, of which more than 
half has been lost in four years . This is reflected in the cornering  of the domestic  market by imports , 
which have constantly grown with an increase of 63 index points during the period under review . 
This situation continued to worsen recent ly, according to dat a for 2019.  
iii. Domestic  production  
 2014  2015  2016  2017  2018  2019  
Production ( index  base 100 in 2014)  100 89 81 83 66 64 
Domestic  production  declined continuous ly and significantly  during  the investigation  period , 
shrinking from 100 to 66 index points between  2014 and 2018, and even further in 2019.  
iv. Sales  and turnover  
 2014  2015  2016  2017  2018  2019  
Sales volume  (index  base 100 in 2014)  100 91 78 85 70 68 
Turnover  (index  base 100 in 2014)  100 102 94 106 93 N/A 
Sales followed the same downward  trend  as domestic  production . A drop of 30 index points  was 
recorded during the review period . This also affected  turnover . 
v. Production  capacity  utilization  
 2014  2015  2016  2017  2018  
Production c apacit y (tonnes)  49,811 49,811 49,811 49,811 75,011 
Production capacity utilization  
(index  base 100  in 2014)  23% 20% 18% 19% 10% 
Production capacity utilization by the domestic industry has always been very low since 2014 but it 
continued  to decrease until 2018. It fell from 23% to 10% during the investigation period . 
vi. Emplo yment  
 2014  2015  2016  2017  2018  
Number of employees  (index  100 in 2014)  100 90 90 89 87 
Employment  in the domestic  industry shrank  during the review period, with a loss of 13 index points  
from 2014 to 2018.  
vii. Productivit y 
 2014  2015  2016  2017  2018  
Productivit y (index  100 in 2014)  100 71 64 63 56 
The annual decrease in domestic  production led to a downward trend in productivity, with a value 
loss of 44 index points  since the start of the investigation period . G/SG/N/8/MDG/6  
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  viii. Profitability  
 2014  2015  2016  2017  2018  
Net result s (index  100 in 2015)  -53 100 145 221 108 
Results/Turnover  -0.63%  1.15%  1.81%  2.46%  1.36%  
Even though the above table shows a slight improvement in net result s between  2015 and 2016, it 
represents very little profitability  for the domestic  industry since it remains at a very low level , 
generally represent ing under  2% of turnover . In addition, a considerable dip of over 50% was 
recorded between 2017 and 2018.  
2  PROVIDE INFORMATION ON WHETHER THERE IS AN ABSOLUTE INCREASE IN IMPORTS 
OR AN INCREASE IN IMPORTS RELATIVE TO DOMESTIC PRODUCTION  
In the wake of unforeseen developments , soap has been imported in significantly increased  
quantities into Madagascar, both in absolute terms and relative to domestic production . The volume 
of import s has almost tripled in the four years following the start of the investigation peri od, rising 
from 10,191 tonnes to 27,131 tonnes between  2014 and 2018, i.e. a 1 66% increase in absolute 
terms . For the recent period , the volume of import s reached 29,093 tonnes.  
Relative to domestic production , the increase in soap imports has continued , reaching 301% in four 
years and  347% in the fifth year of analys is, as shown in the table below : 
 2014  2015  2016  2017  2018  2019  
Imports (tonnes)  10,191 16,630 22,263 25,729 27,131 29,093 
Increase  in imports (%)  - 63% 118%  152%  166%  185%  
Domestic p roduction ( index  100 in 2014)  100 89 81 83 66 64 
Increase  in imports/Production (%)  - 84% 170%  203%  301%  347%  
3  UNFORESEEN DEVELOPMENTS  
The very intensive use of washing machines favours an increase in demand for washing powder or 
washing liquid in developed countries, where the household  equipment  rate is over 98%. This has 
resulted in exports of solid household  soap being directed  towards  markets  in developing countries, 
including Madagascar . Indeed , the volume of worldwide exports from Madagascar 's main soap 
suppliers , namely Indon esia, Malaysia and  Pakistan , is mor e or less stable , whereas  the volume of 
soap exports to Madagascar has increased exponenti ally. Moreover , exporters  have changed their 
strategy, exporting soap in the form of pellets  in order to compete with domestic production.  
This redirection of export s plus the change in export  strategy  constitu te an unforeseen development 
under  Article XIX of the General Agreement on Tariffs and Trade (GATT).  
4  PRECISE DESCRIPTION OF THE PRODUCT INVOLVED  
Soap classified under Madagascar customs tariff codes 34011110, 34011190, 34011911,  34011919, 
34011990, 34012010, 34012090  and 34013000.  
5  PRECISE DESCRIPTION OF THE PROPOSED MEASURE  
The National Trade Remedies Authority (ANMCC) has not yet proposed any measure t o follow up on 
the finding of serious injury or threat thereof . It is currently studying the recommendations to be 
made regarding the appropriate measures to be notified subsequently.  
6  PROPOSED DATE OF INTRODUCTION OF THE MEASURE  
See reply to point 5 above.  
7  EXPECTED DURATION OF THE MEASURE  
See reply to point 5 above.  G/SG/N/8/MDG/6  
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  8  IF THE EXPECTED DURATION IS OVER ONE YEAR, PROVIDE THE EXPECTED TIMETABLE 
FOR PROGRESSIVE LIBERALIZATION OF THE MEASURE  
See reply to point 5 above.  
9  IF THE NOTIFICATION RELATES ONLY TO A FI NDING OF SERIOUS INJURY OR THREAT 
THEREOF, AND DOES NOT RELATE TO A DECISION TO APPLY OR EXTEND A SAFEGUARD 
MEASURE:  
i. provide the deadlines for interested parties to comment or any other procedures 
relevant to the decision to apply the measures, and  
ii. provide information regarding procedures for prior consultation with those 
Members having a substantial interest as exporters of the product concerned.  
Details of the procedures and deadlines relating to the investigation are contained in the notice of 
initiation.  
In accordance with  Article 12.3 of the WTO Agreement on Safeguards, Madagascar is prepared to 
hold consultations with Members having a substantial interest as exporters of the product concerned 
no later than 24 July 2 020. 
Requests for consultation s should be sent to the Director -General of the ANMCC at the following 
email address:  dg.anmcc@gmail.com . 
Comments and requests for additional information should be sent to  the following address:  
Monsieur Le Directeur Général de l'ANMCC  
Enceinte Ex conquête Antanimena - BP: 7653 
Tel: +261 34 05 441 41  
Email: dg.anmcc@gmail.com ; dg@anmcc.mg  
101- ANTANANARIVO - MADAGASCAR  
 
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