HC Deb 24 July 1978 vol 954 cc1127-30
7. Mr. Canavan

asked the Secretary of State for Trade what action he has taken following the recent representations which he has had about the effect of imports on the chipboard industry.

20. Mr. Beith

asked the Secretary of State for Trade what representations he has made to the European Commission about the dumping of chipboard on the United Kingdom market.

Mr. Meacher

Price undertakings have already been given by a number of suppliers and my officials are in regular contact with the Commission about their observance. We have also drawn the attention of the Commission to the low prices in intra-Community trade and urged it to find ways of remedying the problem.

Mr. Canavan

Is my hon. Friend aware that, since I and other Members of Parliament met him to discuss this matter, redundancies have been announced in a chipboard factory in Irvine, in the constituency of my hon. Friend the Member for Central Ayrshire (Mr. Lambie)? In view of the gravity of the situation, will the Government take unilateral action instead of just going cap in hand to the Common Market Commissioners? Unless firm action is taken now, there will be hundreds more redundancies in the industry in places such as Cowie, in my constituency.

Mr. Meacher

I am aware of the notice of redundancies. I regard this as an extremely serious problem and one that revolves around the inadequacy of the present EEC anti-dumping provisions in regarding the Common Market as a single integrated market when the United Kingdom regionally is particularly vulnerable to dumping because of its efficient distribution system. For that reason, and because after the end of the transitional period no anti-dumping action can be taken against other member States—and we are now in that situation—we have taken this up at a high level with the Commission and we have insisted that measures should be taken to solve the immediate problem, which is caused by Belgian dumping.

Mr. Beith

Is the Minister satisfied that the below-cost dumping from States outside the EEC is being or will shortly be stopped by the Commission, or is he making further representations on that point? Also, is he aware that the jobs effect of the situation that has now developed extends far beyond the chipboard factories into the whole of the rural areas, through the sawmills and the forestry industry?

Mr. Meacher

I am aware of the knock-on effects of dumping on the chipboard industry.

As regards the question of price undertakings given by the Swedes and the Finns, my understanding is that at present the Finns will maintain their price undertaking, although there is information which suggests the contrary. We shall certainly look to the Commission to take action if that is not adhered to. As regards the Swedes, there is dispute, as the hon. Gentleman knows, as to whether the price undertakings are net of all discounts. We are convinced that our interpretation is correct, and we are pressing our interpretation with the Commission now.

Mr. Monroe

Is the Minister aware that a chipboard factory in my constituency, in an area of very high unemployment, closed down this summer on account of competition, of dumping, from outside the EEC? What further steps will he take about this? Can he say a little more about the long-term effects on the forestry industry if something is not done very soon?

Mr. Meacher

I have already indicated what steps the Government are taking. We intend to see, so far as we can, that the price undertakings given in particular by the Swedes are maintained. If they are not, we shall consider pressing the Commission to take anti-dumping action, although there are difficulties here with the Commission, inasmuch as United Kingdom production accounts for 5 per cent. or less of the total Community market, and at present the Commission appears to be unwilling to act on that basis. However, we shall certainly press it to do so if necessary.

Mr. Lambie

In view of the redundancies now taking place in my constituency, and the fear that unless something is done seven of the chipboard factories now manufacturing in the United Kingdom will have to close, is not this the time to tell the Commission "To hell with the difficulties", to take unilateral action and tell the Commission that we shall stop all imports into this country in order to keep our native industry going?

Mr. Meacher

If we were to take unilateral action to impose quantitative restrictions on imports of chipboard into this country, that would be illegal under article 30, which is directly applicable, as a result of a decision of the European Court, in the courts of this country. Therefore, consistent with our legal powers, we are taking all the action we can. I still expect that we shall be able to be more effective, or at least that the Commission will be able to be more effective, than we have so far been, particularly in respect of Belgian dumping, where we expect and intend to get action.

Mr. Thompson

Will the hon. Gentleman comment on the rumour that is going round the timber industry that some of the problem is caused by murky deals involving shipbuilding contracts with Eastern European countries, in exchange for which Eastern European chipboard is being allowed to flood our markets?

Mr. Meacher

My understanding is that there is no truth in those rumours.