Merchant Shipping (Soviet Bloc Competition) (Hansard, 27 November 1978)

§ 9. Mr. Blaker
asked the Secretary of State for Trade what recent discussions he has had with other EEC Ministers about the difficulties caused to British merchant shipping by unfair competition from shipping of the Soviet bloc.

§ 22. Mr. Goodlad
asked the Secretary of State for Trade when next he proposes to discuss shipping matters with his opposite number in the USSR.

§ 33. Mr. David Hunt
asked the Secretary of State for Trade what progress he can report on the measures proposed to counter the Soviet maritime threat.

§ Mr. Clinton Davis
The Transport Ministers Council last week adopted a decision limited to monitoring all liner activities on the trade routes from the EEC to East Africa and Central America. Regrettably there was no disposition to proceed at present with the development of counter-measures to meet unfair competition, such as the Soviet threat. I expressed the United Kingdom's disappointment and urged further consideration of this issue. I have no plans for further discussions with the Soviet Minister. There is no point in this until progress has been made in resolving some of the specific issues of concern to us.

§ Mr. Blaker
Is the Minister aware that the House will share his disappointment that the Ministers have limited themselves to gathering further informa- 12 tion about the unfair competition which is clearly already taking place and has been taking place for some time? Is it not likely to be the result that the shipping companies of member countries will suffer further damage in the interim before a decision is taken to act to stop this threat?

§ Mr. Davis
This is a point which I have made because I believe that the evidence already is overwhelming in this regard. However, colleagues in the EEC take the view that monitoring is an essential precondition of taking any defensive measures, if they find that defensive measures are called for as a result of that procedure. I think that this is a longwinded way of going about the matter.

§ Mr. Goodlad
If it is decided that further measures are necessary, what measures will the Minister recommend should be taken?

§ Mr. Davis
We should be ill advised at this stage to advertise to the Soviet Union the precise steps that we would want to take if we could persuade our colleagues in the EEC to recognise the threat. But we have the powers.

§ Mr. Hunt
Will the Minister explain why the decision makes no reference to the Soviet threat? Will he accept from this side our welcome of some of the words that he has uttered in answer to this question? However, will he please explain his reference to"further consultations "? What further consultations has he in mind?

§ Mr. Davis
The omission of the specific Soviet threat is not a matter of our making. I have consistently tried to persuade colleagues in the EEC to use precisely those terms. The question of consultation will proceed before the next Transport Ministers Council and it will at my request cover a study—I hope I shall be able to persuade the Commission to undertake a study—of the defensive measures which need to be taken. Unless we get that right, I do not think that we have any real chance of securing an accommodation with the Soviet Union, which is what I want.

§ Mr. Litterick
What, if anything, does the Minister's Department know of the relationship between the cartelised freight charges now being made by our shipping 13 organisations and the actual costs to them of running their ships?

§ Mr. Davis
The conference system, which I think my hon. Friend is seeking to impugn, meets the approval not only of the shipowners but of the shippers whom they are intending to serve. There is a large shipper element in these discussions. If they felt that unfair advantage was being taken by the shipowners in the operation of the conference system, they would be the first to complain.

§ Mr. Adley
Since the Minister has described the EEC's efforts as longwinded, is there not a case for this country taking unilateral action on this matter, as the French have done, for example, over the oil measures? Is there anything in the Treaty of Rome which would prevent us from taking unilateral action?

§ Mr. Davis
It is not a question of the Treaty of Rome: it is a question whether such action would be useful and rational. I believe that if we did that, all that would happen is that we would expose ourselves to the blast of possible counter-measures by the Soviet Union without anybody else in Europe suffering. I simply do not believe that it is reasonable for us to adopt a unilateral design in this matter.

§ Mr. Parkinson
The Minister has already said that difficulties are being caused to our shipping industry by the Soviet bloc. He claims that it is difficult for us to take unilateral action. There is one unilateral action that we could take, and that is to cancel the Polish shipping order, which will result in dumped cut-price competition for our shipping industry and which was decided exclusively by his Government.

§ Mr. Davis
Uncharacteristically, the hon. Member has taken a totally irrelevant point. I am talking about the Soviet threat. Generally, when the Poles are members of conferences they adhere to the rules of conferences and there is much less difficulty in that regard. I think that the hon. Member's suggestion would promote further unemployment in the shipbuilding industry, which is a view that we on this side do not share.