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Multi-Fibre Arrangement

Volume 23: debated on Monday 10 May 1982

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asked the Minister for Trade if he will report on the state of negotiations on the renewal of the bilateral agreements within the multi-fibre arrangement.

So far, the Commission has held only informal exploratory consultations with the supplying countries. Formal negotiations are scheduled to commence this week in Brussels.

Since any increased access to our markets by smaller supplying countries could be achieved only on the basis of cutbacks from the so-called dominant countries, how does the Minister justify starting negotiations with the dominant countries before he has successfully concluded the position with them to enable him to make concessions to the smaller countries?

The whole House will know that the European Commission has been given a fairly strict mandate to negotiate bilateral agreements under the MFA and with the Mediterranean countries outside the arrangement. We have made it clear that we expect cutbacks of 10 per cent. from the dominant countries, perhaps compensated in certain cases by outward processing. Against that background, I feel sure that it will be possible for the Commission to negotiate satisfactory bilaterals, although we must wait until the autumn to hear the outcome.

Is the Minister aware that some of our partners have been weak sisters in negotiating textile arrangements? Do we have a veto on the negotiations, and if we do will the Government use it if the result of the negotiations is not satisfactory to British textile interests?

It is not for me to comment on the position of individual members of the Community. Each country has a slightly different perception of the interests of its textile industry. However, I have told the House previously that a common Community position was evolved which attracted the support of every member of the EEC. The Commission will have to negotiate within the confines of that position.

I thank my hon. and learned Friend for the concern that he has shown for the textile industry so far. In the run-up to the negotiation of the bilaterals, will he continue to listen to the strong case put to him by the British textile industry and disregard the representations of the British Consumers Association and the German Government?

My hon. Friend's concern for the textile industry, particularly in North-East Lancashire, is well known to the House and I have had the privilege of meeting some of its representatives in his company. I assure him that the Community position has been clearly defined and, although it may not have attracted the universal support of the textile industry, I hope that there is grudging recognition that it could lead to a tougher MFA than the preceding arrangement. It is certainly the Government's intention that that should be the eventual outcome of the negotiations.

Do the Government remain committed to the negotiation of a tough and effective MFA bilateral agreement, as the Minister has claimed in the past, and will the hon. and learned Gentleman confirm that the EEC will withdraw from the MFA if the outcome of the negotiations is unsatisfactory? If so, why does he continually refuse to take immediate steps to prepare an alternative trading policy in case the negotiations fail?

As I have reported to the House, it is the Community's intention to withdraw from the MFA if the bilaterals negotiated under it do not, in total, measure up to the guidelines agreed in Brussels and reported to the House. As regards the possibility of failure, it would be a little premature for the United Kingdom in isolation to devise an alternative regime for textiles. It would be an unnattractive position for the world if the EEC could not remain an adherent signatory of the MFA, and it is wrong to speculate too deeply at present on the consequences of failure. I hope that such speculation will prove to be unnecessary.

Will my hon. and learned Friend bear in mind in the negotiations the interests of the consumer and of poorer countries which are trying to trade with us? The textile industry in this country needs a certain amount of protection, but it is essential for our general trade and for the benefit of our consumers that low-income countries are able to trade with us in low-price textiles.

The Government are very conscious of the consumer interest, and a delicate balance has to be struck in the negotiations between the interests of the textile industry, which is important, of the consumers and, as my hon. Friend points out, of the developing nations. It was thought right in the mandate given to the Commission to cut back on some of the dominant suppliers, who are economically stronger, and perhaps to give a little more leeway to the developing nations.

Will the Minister think again about the answers that he has given to my hon. Friends? A new MFA is of paramount importance to our textile industry. In view of the many thousands who have been made redundant and will never find work again in the industry, will the hon. and learned Gentleman look at the matter again and consider using the veto, if necessary, against any country that tries to foist on us an agreement that will cause further unemployment here?

I reassure the house that the Government are conscious of the 150,000 jobs shed by the United Kingdom textile industry over the past 18 months. I also assure the hon. Gentleman that there is no need for a veto, because the decision of the EEC is that if successful bilaterals cannot be negotiated within the outline of the MFA, which the EEC has signed only on that tentative basis, the Community will withdraw. There is no need for a veto. I merely suggested to the hon. Member for Batley and Morley (Mr. Woolmer) that I preferred not to speculate on the consequences of failure, which would be damaging to consumers and the textile industry of this country.