G/SG/N/6/MDG/12  
4 January  2024 
(24-0029) Page: 1/4 
Committee on Safeguards  Original:  French  
 
  
NOTIFICATION UNDER ARTICLE 12.1 (A) OF THE AGREEMENT ON SAFEGUARDS  
ON INITIATION OF AN INVESTIGATION  
AND THE REASONS FOR IT  
MADAGASCAR  
Woven sacks and sheaths of polypropylene  
The following communication, dated and received on 29 December 2023, is being circulated at the 
request of the delegation of Madagascar.  
 
_______________  
 
 
In accordance with Article  12.1(a) of the Agreement on Safeguards, Madagascar hereby notifies the 
Committee on Safeguards of the initiation of an investig ation in respect of imports of woven sacks 
and sheaths of polypropylene.  
1. Date of initiation  
The investigation was initiated on 27 December 2023, the date on which the notice of initiation was 
published in two national newspapers authorized to receive legal notices, La Vérité  and TARATRA . 
2. Product under consideration  
Woven sacks and sheaths of poly propylene under Madagascar Customs tariff codes: 39202000, 
39206910, 39209300, 39209900, 39232100, 39232910, 39232990, 39269090, 
63051011, 63051012, 63051021, 63053210, 63053220, 63053310, 63053320, 
63053321, 63053329, 63053330, 63053910, 63053920 and 6306 1900 . These codes are 
indicative and are subject to change.  
3. Exporting countries  
The main exporting countries are China, India and Thailand.  
4. Reasons justifying the initiation of the investigation  
The domestic industry producing like and directly competitive  products has filed a petition requesting 
the application of a safeguard measure. The petition contains sufficient evidence of serious injury 
caused by increased imports of woven sacks and sheaths of polypropylene . Thus, all the relevant 
conditions for ini tiating the investigation have been met.  
4.1.  UNFORESEEN DEVELOPMENTS  
The global market for woven sacks and sheaths of polypropylene has shown strong and sustained 
growth in recent years. The Asia -Pacific region, particularly China, India, Japan, Republic of Ko rea 
and South -East Asia are among the main, very active players that supply these products for the 
global market. Rising per capita income, population growth and, above all, economic growth in line 
with recovery of the post -COVID -19 global economy all offe r opportunities for the expansion of the 
market for woven sacks and sheaths of polypropylene. Their advantages are that they are light G/SG/N/6/MDG/12  
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  weight, cost -effective and practical, and they are also environmentally -friendly. Against the 
backdrop of the global figh t against single -use plastics, these products are one of the preferred 
alternatives as they can be used several times.  
It could not have been foreseen when Madagascar acceded to the WTO that these circumstances 
would arise, which ha ve led to increased imp orts of woven sacks and sheaths of polypropylene into 
the country.  
4.2.  INCREASE IN IMPORTS  
i. Absolute change in imports  
In absolute terms, the volume of imports of woven sacks and sheaths of polypropylene increased 
considerably during the period under consideration. Compared to 2019, the base year, this volume 
increased by 11, 27 and 65 index points in 2020, 2021 and 2022, respectively. For the first 
11 months of 2023, an increase of 11 index points was recorded compared to the same period of 
2022.  
ii. Relative change in imports  
There has been a significant increase in imports relative to domestic production during the period 
under investigation. Compared to the base year, this increase was 83 index points in 2022. In the 
first 11 months of 2022 and 2023, de spite the relative deceleration in imports to 12 index points, it 
is far from returning to the level of the base year.  
4.3.  SERIOUS INJURY  
i. Production  
According to the petition data, a downward trend in domestic production was seen during the period 
under consideration. The production volume has not returned to its initial level, despite the slight 
increase in 2021 compared to 2020.  
ii. Sales and market share  
a. Sales volume  
During the period of investigation, the domestic industry's sales volume declined. Compare d to the 
base year, the decreases have been in the order of 13, 11 and 17 index points in 2020, 2021 and 
2022, respectively. This downward trend continued until November 2023.  
b. Market share taken by imports  
Imports hold a significant share of the market. In  addition, the market share of imports grew steadily 
during the period under consideration. Meanwhile, the market share of the domestic industry 
declined considerably throughout the period, shrinking by 29 index points between 2019 and 2022. 
No changes wer e observed  during the first 11 months of 2023.  
iii. Inventory  
Compared to 2022, the inventory volume grew by 22 index points in 2023. The analysis of changes 
in inventory indicates that the domestic industry has difficulties in disposing of its output.  G/SG/N/6/MDG/12  
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  iv. Producti on costs  
The domestic industry's production costs trended upward during the period of investigation. 
Compared to the base year, it increased by 13, 30 and 29 index points in 2020, 2021 and 2022, 
respectively. Costs appeared to remain stable for the first 1 1 months of 2023, compared to 2022.  
v. Employment and productivity  
The domestic industry has made efforts to maintain employment levels. During the period of 
investigation, employment levels remained virtually stable. However, productivity has fallen steadily.  
vi. Production capacity utilization  
According to the petition data, the production capacity utilization rate fell by 10 index points between 
2019 and 2022, and by 8 index points during the last part of the period of investigation.  
vii. Profits and losses  
The domestic industry's performance continued to worsen steadily during the investigation period. 
It shrank by 42 index points between 2019 and 2022. For the first 11 months of 2023, a fall of 
30 index points was recorded compared to the same period of 202 2.  
4.4.  CAUSAL LINK  
i. Effect of the increase in imports  
In the light of the foregoing analysis, it can be seen that the increase in imports of woven sacks and 
sheaths of polypropylene coincides with the deterioration of most of the domestic industry's 
indicators . It can be concluded that the injury suffered by the domestic industry is likely to have 
been caused by increased imports.  
 
ii. Other serious injury factors  
a. Domestic competition  
Competition among domestic producers of woven sacks and sheaths of polypropylene is almost 
non-existent, as the total volume of their output is well below the level needed to meet domestic 
demand. Similarly, no domestic producer is in a dominant position in the market. Thus, domestic 
competition cannot be considered a sou rce of the injury suffered by the domestic industry.  
b. Contraction in demand  
Domestic demand for woven sacks and sheaths of polypropylene has continued to rise during the 
investigation period ; growth of 23 index points was recorded for the whole investigation period. That 
is why a contraction in demand is in no way the source of the injury to local producers.  
c. Technology and quality of the product concerned  
There are no significant differences, w hich could affect the products' quality, between woven sacks 
and sheaths of polypropylene that are manufactured locally and those that are imported. These 
products are manufactured using same techniques and technologies. Thus, neither the technology 
used n or the quality of the product concerned can be considered as a source of the injury.  
In the light of the foregoing, the Authority has concluded that none of these other factors can be 
considered a primary cause of the serious injury suffered by the domesti c industry. Thus, the 
existence of a causal link between the increased imports and the serious injury has been verified.  G/SG/N/6/MDG/12  
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  5. Duration of the investigation  
The investigation will last for around 9 months and may be extended up to 12 months.  
6. Further information  
Interested parties must make themselves known to the ANMCC, the Investigating Authority, within 
a period of 30 days after the initiation of the investigation.  
Any information or comments that interested parties may wish to submit, and requests for 
question naires, must be submitted in writing to the ANMCC within a period of 30 days after the 
initiation of the investigation.  
The ANMCC may organize public hearings, either at the request of interested parties or ex officio , 
so as to enable interested parties to  present evidence and, in particular, to have the opportunity to 
respond to the presentations of other parties and to make their views known, and to defend their 
interests.  
Replies to the questionnaire and any other relevant information that the parties wi sh to submit must 
be sent to the ANMCC within a period of 30 working days.  
If the replies to the questionnaire and any additional information requested from the interested 
parties within the framework of this investigation is not provided within the specif ied time frame, 
decisions will be made on the basis of the best information available. This will also be the case if 
information is erroneous or incomplete.  
7. Further information  
Requests for further information and correspondence regarding the investigation must be sent to:  
 
Monsieur Le Directeur Général de l'ANMCC  
Enceinte Ex -Conquête Antanimena, Antananarivo 101 - Madagascar  
Email: dg@anmcc.mg  / dg.anmcc@gmail.com  
Webs ite: www.anmcc.mg  
 
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