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Multi-Fibre Arrangement

Volume 15: debated on Monday 14 December 1981

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asked the Secretary of State for Trade if he will make a statement on progress on the renegotiation of the multi-fibre arrangement.


asked the Secretary of State for Trade if he will make a statement on the latest progress towards renegotiation of the multi-fibre arrangement.

As my right hon. Friend the Lord Privy Seal reported on 10 December, the Council of Ministers met on 8 December to consider further arrangements covering low-cost textiles and clothing imports. It resolved a number of points outstanding from the November Council. These decisions will enable the Commission to continue its full participation in the negotiations in Geneva on multi-fibre arrangement renewal, and also to open negotiations on future arrangements with the preferential suppliers.

Negotiations in Geneva are continuing.

Is the Secretary of State aware of the very grave anxiety and concern on both sides of the House and on both sides of industry about the lack of information on the decisions reached in the Council of Ministers in Brussels? Is the right hon. Gentleman aware, further, that there are fears that the quota base level may be set at the level of 1982 quotas, with a foreseen loss of 30,000 jobs if that happens, rather than 1980 actual levels of imports? Will the right hon. Gentleman now say what base level—is it 1980 quotas, 1982 foreseen quotas or somewhere in between—the Council of Ministers has decided to adopt as its negotiating plank in Geneva?

The hon. Gentleman will be aware that it has always been the practice not to reveal the detailed negotiating mandate that is in the hands of the Commission.

As for the issue of 1980 actuals or quotas being used as the basis for multi-fibre arrangements No. 3, the Community is operating upon 1980 quotas with the use of a surge mechanism to moderate any take-up in the under-used quotas.

Is the right hon. Gentleman aware that it is both undesirable and dangerous to base the anti-surge mechanism on actual import levels in 1982, because it gives every incentive to supplying countries overseas to maximise their exports to us next year by every possible means, and because any restocking then will benefit them rather than domestic suppliers? Will not the anti-surge mechanism be ineffective if quotas currently under-utilised are filled by 1982?

The Commission has been charged to interpret and table the anti-surge proposals specifically to try to mitigate the differences which the hon. Gentleman has understandably identified.

When my right hon. Friend continues the discussions on the multi-fibre arrangement, will he ensure that an import control clause is incorporated in the agreement to prevent unfair competition from foreign imports, which have affected British manufacturers seriously over the last few years and continue to do so?

Clearly, such action would have to come within Community competence, but I should like to consider what my hon. Friend has suggested.

Will the Secretary of State say again whether agreement was reached at last week's meetings on resolving the various issues before the negotiators? Is he aware that there is a widespread feeling in the House and outside it that no agreement has been reached on growth rates, quotas, and the various ways of avoiding problems?

Will the right hon. Gentleman say again whether the base level is, as he said, the 1980 quotas or whether the Government have accepted, against our advice, that the 1982 quotas should be used as the base level?

I have nothing to add to my first reply.

I congratulate the hon. Member for Batley and Morley (Mr. Woolmer) on his first appearance at the Dispatch Box, speaking from the Front Bench on behalf of the Opposition. I can tell him that the negotiations at Geneva are proceeding, and that today could be one of the most decisive days. There is little that I can tell the House, other than to await the outcome, especially of today's discussions.

I thank the right hon. Gentleman for his kind remarks, but I have to tell him that his answers are unsatisfactory. Will he say again whether agreement was reached at the Council of Ministers last week? If it was not reached, the right hon. Gentleman is in serious danger of grossly misleading the House.

I hope that the hon. Member for Batley and Morley will grow more charitable with experience in his new post. I believe that agreement was not reached. But the negotiations continue. I must remind the House that these negotiations are being undertaken on behalf of the European Community nations by the European Commission. It is one of the inevitable consequences that I cannot answer blandly for what is happening minute by minute and hour by hour in the negotiations, given the relationships that we have in the Community.

Has my right hon. Friend's Department made any progress on defining what is meant by a "recession clause" in the MFA, and is my right hon. Friend using that definition in the negotiations?

The Commission has the securing of a recession clause as one of its negotiating objectives. Again, it would not be consistent with precedent—and I do not intend to break precedent—to reveal the circumstances that the Commission counts as constituting a recession clause.