Multi-fibre Arrangement (Hansard, 15 January 1986)

§ 6. Mr. Gould
asked the Secretary of State for Trade and Industry what progress has been made in preparing for the negotiations for the renewal of the multi-fibre arrangement.

§ 13. Mr. Lawler
asked the Secretary of State for Trade and Industry if he will make a statement on the current position regarding negotiations concerned with renewal of the multi-fibre arrangement.

§ Mr. Channon
The Council of Ministers will be considering the Community's negotiating mandate at its meeting on 27 and 28 January. I announced the policy of the Government in the House on 9 May last year. I am meeting representatives of the industry and other interested parties next week.

§ Mr. Gould
Is the Minister aware of the anxiety felt in all parts of the industry at the strong and persistent report that, despite his stated commitment to the effective renewal of the multi-fibre arrangement, British officials are in the van of those in Brussels who are pressing for a weakening of the import regime? Does he recognise that a substantial dilution of the MFA will cause immense 1063 damage to the British industry, and will he assure the House that henceforth his officials will work religiously towards the achievement of an effective renewal?

§ Mr. Channon
I assure the hon. Gentleman that the British officials in the negotiations are working under instructions from me and are following the Government's policy. I am surprised that the hon. Gentleman, with his experience in this area, should imagine anything else.

§ Mr. Lawler
There is some anxiety and confusion in the industry about whether the Government believe that this should be the last such arrangement. Will my right hon. Friend clarify the position?

§ Mr. Channon
We have never said that this should be the last MFA. A new MFA is likely to last for four or five years. The longer-term future of the MFA should be decided in the context of the proposed new GATT round of international trading talks.

§ Mr. Torney
Is the Minister aware that the textile industry in Bradford has suffered for many years because of the importation of goods produced by competitors who use cheap labour? Is he further aware that if the multi-fibre arrangement is not renewed, or if it is weakened, it will create chaos in the woollen textile industry in Bradford and bring more unemployment to an area which already has above national average unemployment?

§ Mr. Channon
The hon. Gentleman knows that it is the Government's policy that the MFA should be renewed. He will be pleased to know that during the first 10 months of 1985 wool textile exports increased by 14 per cent. to a record £518 million.

§ Mr. Meadowcroft
Is it not true that many companies have coped and will cope with the diminution in the MFA, and that even within companies, some sections—for instance, spinning—will benefit from imports, whereas other sections, such as finished products, will suffer? Will the Minister remember that in any renegotiation we must be aware of that distinction and assist British companies to cope with the genuine free market at which they are aiming rather than protect them artificially?

§ Mr. Channon
In general I agree with the hon. Gentleman. I am meeting representatives of the industry next week, and no doubt all those points will be considered in great detail.

§ Mr. Sims
In the discussions, will my right hon. Friend take particular account of the views of the Hong Kong Government? Is he aware that although the present agreement is supposed to benefit underdeveloped countries the benefit has been very small and it has been to the disadvantage of Hong Kong? Will he ensure that the future agreement, if it does not help Hong Kong, at least does not penalise it?

§ Mr. Channon
It is not for the British Government alone to decide the contents of the agreement, but we certainly take the view that it should give favourable treatment to the poorest developing countries and to developing countries with very low barriers to British exports, which includes Hong Kong.

§ Mr. James Lamond
Is the right hon. Gentleman aware that import penetration in textiles is six times what it was 10 years ago and that unemployment is again increasing in the north-west, including my constituency, 1064 which still depends heavily on the textile industry? Will he check again with his civil servants on the point made by my hon. Friend the Member for Dagenham (Mr. Gould), because authoritative sources on the employers' side suggest that British civil servants are taking a leading part in pressing for a much more liberal multi-fibre arrangement?

§ Mr. Channon
I assure the hon. Gentleman, as I assured his hon. Friend, that the civil servants negotiating in Brussels do so with my express authority, and I keep a close control on and watch every detail of the negotiations. What the hon. Gentleman said is correct to a certain extent. That is one reason why we are seeking a renewal of the multi-fibre arrangement, which I believe met with the general agreement of the House last May.

§ Mr. Madden
Is the right hon. Gentleman aware that workers in the textile industry suspect that Ministers at the Department of Trade and Industry are more interested in protecting their own political careers than in protecting the British textile industry? Does he accept that although there is no doubt that the Government are committed to renewal of the MFA, there is considerable doubt as to the extent to which the Government want a major relaxation of the controls? Will he now give a firm undertaking that the British Government do not favour or support any major relaxation of the MFA controls?

§ Mr. Channon
The first part of the question says more about the hon. Gentleman than about Ministers at the Department. Any renewed MFA is bound to be more liberal than the present arrangement. I think that that is generally understood. As I have said, it should provide favourable treatment for the poorest developing countries and those with low barriers to British exports, and it should also help in relation to children's clothing. I am anxious to see a more liberal MFA, but one which does not damage the textile and clothing industry. The industry understands that very well, and I shall be discussing the matter in great detail with the industry next week.