Multi-fibre Arrangement (Hansard, 12 February 1986)

§ 8. Mr. Lawler
asked the Secretary of State for Trade and Industry if he will report on the European Economic Community Council of Ministers meeting on 27–28 January to decide the Community's negotiating mandate for renewal of the multi-fibre arrangement.

§ 12. Mr. Waller
asked the Secretary of State for Trade and Industry if he will make a statement about the most recent negotiations towards a renewed multi-fibre arrangement.

§ Mr. Alan Clark
There was a very brief discussion about the multi-fibre arrangement in the Council of Ministers on 27 January. The only decisions taken were to have a substantive discussion at the Council of Ministers meeting on 17–18 February, and to try to agree on a negotiating mandate before the end of February.
Negotiations in the general agreement on tariffs and trade on renewal of the MFA are still at an early stage.
It is too early to say whether we are likely to achieve our objectives as set out by my right hon. Friend the Secretary of State on 9 May 1985.

§ Mr. Lawler
As my hon. Friend will be aware, President Reagan has undertaken not to weaken the MFA. When my hon. Friend attends the next meeting, will he impress upon fellow European Ministers the danger that this presents of a large diversion of trade from the United States should the EEC adopt a weaker policy?

§ Mr. Clark
It is true that the President of the United States actually instructed that negotiations should be 946 conducted in an aggressive manner. We are still awaiting the completion of the terms of the mandate which goes to the commissioners. My hon. Friend can be certain that a variety of views will be encompassed in the discussions.

§ Mr. Waller
Does my hon. Friend accept that some potentially lucrative markets for exporters—one thinks of Taiwan, South Korea and Brazil—are very largely closed because of the policies of their Governments? As those countries are substantial textile and clothing exporters to this country, will my hon. Friend make reciprocity one of his leading objectives in the negotiations that are to take place?

§ Mr. Clark
All negotiations depend on a calculated trade-off of advantage and concession. My hon. Friend has pointed out one of the principal considerations affecting those countries from which textile imports originate. The level to which reciprocity would be to our advantage has to be a matter of calculation and assessment.

§ Mr. James Lamond
Has the Minister been receiving the same rather plaintive representations from employers in the textile industry as many of my right hon. and hon. Friends have been receiving? Is he prepared to meet their desire to protect the very fragile recovery that there has been in the textile industry?

§ Mr. Clark
I would not term the representations as plaintive. There have been well argued and carefully considered representations from a wide variety of employers. They will be taken into account, as will the views of right hon. and hon. Gentlemen in the debate that we are to have tomorrow.

§ Mr. Mason
Is the Minister aware that in my constituency over 2,000 people are employed in the textile and carpet industries? All the shop stewards report to me their serious concern at the liberal attitude taken by the Secretary of State. If the Minister for Trade is to conduct the negotiations, and if he is to take the same liberal attitude as the Secretary of State, what assurances can he give to the workers in my textile and carpet industries that they will be better off, if his attitude prevails, when the MFA has been concluded?

§ Mr. Clark
Some hon. Members may regret it, but it is a fact of life that negotiation is no longer possible bilaterally by the United Kingdom. Negotiations have to be conducted through the Community. The preparation of the mandate is going ahead. Certainly the interests of the right hon. Gentleman's constituents will be very much at the forefront of our considerations.

§ Mr. Dickens
Will my hon. Friend accept that the British textile industry employs more people than the National Coal Board and the British Steel Corporation added together? Does he agree that for the success of the surviving mills, despite the decline in the industry, he must negotiate a new MFA at the same time as he is conducting talks on GATT, which will take many years, as he knows?

§ Mr. Clark
The multi-fibre arrangement negotiations will be completed well before the next round of negotiations on GATT. My hon. Friend is entirely right to draw attention to the very large number of people in the United Kingdom who depend for their employment on the textile industry. It is around the half million mark.

§ Mr. Nicholas Winterton
My hon. Friend has an exceptional reputation for his interest in the national interest of the United Kingdom. Will he assure the House today that he will ensure a robust renewal of the multi-fibre arrangement so that the manufacturing base of this country is not further eroded? I speak not only on behalf of employers but on behalf of trade unions and the work force in the industry when I say that if he fails to do so tens of thousands of people will be out of work. Will he act accordingly in the national interest?

§ Mr. Clark
I am grateful to my hon. Friend for the compliment that he paid me. It is not fair to make a general accusation that the entire textile industry depends for its existence on the perpetuation of the MFA in its present form. The industry is extremely efficient and it would not wish to take refuge in a blindly protectionist attitude. None the less, I am aware of the concern expressed from wide circles in the industry. The negotiations will be long and complex and many different views will be expressed from within the Community in putting the mandate together. I can assure my hon. Friend that I shall take heed of what he says and of the wide variety of representations that I have received on this subject.

§ Mr. Madden
Does the Minister accept that during the lifetime of the existing MFA more than 2,000 jobs in the British textile and clothing industries have been lost, and that that vividly illustrates the need for a strong and effective renewed MFA? Does he also accept that there are important investment decisions riding on the outcome of the MFA negotiations? If he will not accept that from me, will he accept it from the chief executive of Vantona Viyella, who said recently that his company had invested £50 million in the past two years and was prepared to spend more, but that the decision rested on the outcome of the MFA renegotiations? Will he also understand that what he has said will be seen as extremely disturbing throughout many constituencies, represented in some cases by the Minister's hon. Friends, and that if the British textile and clothing industries—[Interruption]—sold out by—[Interruption.]—

§ Mr. Speaker
Order. It is very unfair to ask such a long question, which denies other hon. Members a chance to speak.

§ Mr. Clark
I think that the House showed its impatience with the hon. Member's question by making three quarters of it inaudible. Every job loss is regrettable, but if he really regards the loss of 2,000 jobs out of a work force of 500,000 as being significant—

§ Mr. Alan Williams
Two thousand a month.

§ Mr. Clark
The fact is that the industry is efficient and its exports to certain markets, for example, Japan, have increased at a fast rate. It is not correct to regard the whole industry as requiring perpetual protection under the mechanism of the MFA. Our business is to ensure that when the MFA is renewed, it is done on the basis of hardheaded negotiation, first in the Community and then in the countries concerned, to the mutual advantage of both.

§ Mr. O'Brien
In view of the Minister's replies, does he agree that it is time that Her Majesty's Government took a hard line in the negotiations in the EEC on trade arrangements, as the softly softly approach will hinder or 948 damage the MFA, which will mean a further loss of jobs? Is not the price of the softly softly approach too great for the textile industry?

§ Mr. Clark
I reject the idea that negotiations can be conducted on either hard line or softly softly terms. They are a matter of balance, and what has to be weighed is reciprocal merit of advantage and concessions.