asked the Minister for Industry and Commerce if the Government propose to introduce, in agreement with the EEC Commission, import controls on footwear and textiles in view of the serious unemployment in these industries.
Ceisteanna—Questions. Oral Answers. - Footwear and Textiles.
19.
Following various approaches which I made to the EEC Commission over the last two years, a number of measures have been authorised in order to minimise the impact of imports on sensitive sectors of manufacturing industry. I have, mainly in reply to questions, given details to the House of the measures implemented. I would refer the Deputy in particular to the reply to a question on 18th December, 1975, Volume 286, columns 2099, 2100 and 2101.
Moreover, action has been taken by the Community, to which Ireland is party, through the negotiation of bilateral agreements and, in one case, the imposition of unilateral restraints to regulate imports of sensitive textiles and clothing products originating in certain third countries. For each of the products covered by these restrictions there are annual quantitative limits on a Community basis and also at the level of individual member states.
Ireland has secured the agreement of the EEC Commission on three occasions to certain traiff protection being retained for the footwear industry at a much higher level than would have been the case under the provisions of the Treaty of Accession and the Anglo-Irish Free Trade Area Agreement. Because of the continuing high level of imports of footwear this year, the Commission are now looking into the matter again, at my request.
Is the Minister aware that the various controls put on both footwear and some textiles over the last two years were minimal and had no significant effect whatever on these markets? Is he further aware that the figures available so far this year seem to indicate that the imports of footwear during 1976 approximately equal the entirety of the domestic market for footwear and that in these circumstances there is no future for any factory here unless they can go into exporting in a big way which, naturally, they find difficult to do? In these circumstances, is he prepared to make a genuine and energetic effort to have meaningful and worth-while controls put on for some period to give these industries a chance to get themselves organised and to protect the employment of their workers?
The Deputy's decrying of what has been done is both inaccurate and unjust. Although the demand for specialised controls is one that is easily voiced and easily supported, the Deputy and the country would do well to examine the repercussions of this.
The employment figures for the textile industry up to March, 1976, the latest date for which I have figures, had increased in both previous quarters. Although I do not have hard figures yet of a number of things, such as the Wellman and Burlington openings, there is every likelihood that employment will go on like this. The other point is that without measures, such as reorganisation, merely putting on controls does two things: it is inflationary because prices in the absence of competition can rise on the domestic market, and it protects people from the necessary streamlining and the development of efficiency which has to take place if we are going to contend in the reality of free trade in the Common Market. We have taken a number of measures with which the Deputy is familiar. They have produced some protections but fewer than we would like. In a number of these areas we remain net exporters and our export performance is quite heartening where there has been attention to quality, design and efficiency of production. Merely to suggest that the introduction of selective import controls could solve the problem in a country as vulnerable to reciprocation as we are, is in fact not to express the real interests of those industries.
We are in continuous contact on this. The secretary of my Department and others are in Brussels today about this as a result of an initiative I started in July and carried further in September and we hope to get more protection. I have to emphasise that in the long run the thought that we can solve our problems in these areas in any other way than by efficiency and competitiveness is a false belief and is not in the interests either of Irish consumers or of the long term health of the industries themselves. We are horrendously vulnerable to counter-attack by countries close to us. If we had no dependence on exports in these areas, that would not matter. It would, of course, matter for other kinds of exports. Since we have quite substantial and in many cases dramatically growing exports, we are not in a position to call down on our heads that sort of retaliation if we act unreasonably. We are acting to the limit of what is prudent and reasonable and, in my belief, to the limit of what is in the best interests of the industries themselves.
The Minister has not contradicted my statement that imports of footwear so far this year at least equal the domestic market. Is the Minister aware that the footwear federation has not been calling for a banning of footwear imports or for the imposition of heavy tariffs but is simply calling for the imposition of a quota limiting footwear imports to 50 per cent of the domestic market and would the Minister not agree that this is a reasonable request and that, in the absence of its not being met, the federation cannot guarantee the future of any factory within their federation?
I understand the motivation for that demand. It is a demand I have raised at Brussels. It is a demand that, without the agreement of Brussels, I am unable legally to implement. It is also a demand which it is extremely unlikely Brussels will permit Ireland to implement.
Will the Minister agree that the case is being expressed here in such a half-hearted way there is just no possibility that Brussels would agree to it, but would the Minister also agree that the serious danger of retaliatory action, as he puts it, against us if we take any sort of action to protect our own vulnerable industries is exaggerating the situation? Will he agree that he exaggerates in believing such action is likely bearing in mind that the footwear industry here constitutes about 1 per cent of the footwear industry in the Community and that it has no effect whatever on the Community market, on community prices, or anything else, and that other countries which took action to protect themselves and their vulnerable industries were not subjected to retaliatory action and I can instance the Italian Government——
A brief question, please. We cannot debate the matter now.
——which took stringent steps and why does he think a small and comparatively weak country, like Ireland, will bring all these retaliatory measures down on top of it——
Order. This question is too long.
First, the Deputy is inventing a situation in regard to other important markets. What he says about the total volume of the Irish industry is absolutely right and were that the only reason we would be perfectly safe. It is not a matter of volume only. It is a matter of being able to cite international pretexts because the footwear industry in many other countries is in a similar state and all the efforts of those concerned to protect the growth of world trade have been to prevent the outbreak of an avalanche of protection which, in the long run, would damage world trade and damage most those countries which export the highest percentage of their GNP.
May I ask the Minister——
I am calling Deputy Faulkner. The Deputy will have an opportunity later. I will call the Deputy in due course.
Will the Minister agree that a sound home base is essential for a worth-while export base and that, in spite of the controls which he states he has got from the EEC, or the right to exercise these controls from the EEC, imports have increased very considerably and were that trend to continue we would have no industry at all? It is rather futile, therefore, to talk about safeguarding our exports when, in fact, we will not have an industry from which to export.
I think the Deputy is exaggerating but I also think the thrust of the point he makes of the danger of wiping out our footwear industry is a real one. I think he exaggerates a bit and, in fact, had I not been convinced the danger was there I would not have gone back to the Commission for further protection.
Would the Minister agree that if all the patriots bought Irish footwear we would have no problem?
Deputies
Hear, hear.
Further arising from the Minister's remarks about efficient production, would the Minister agree that no matter how low our unit costs are we cannot complete with a country like Taiwan?
Of course, I agree.
20.
asked the Minister for Industry and Commerce if he will indicate the countries which subsidise the export of their footwear to EEC countries.
As the Deputy will appreciate, it is not possible to acquire definitive information on this subject, especially on a Community basis. So far as the Irish market is concerned certain mechanisms, including the surveillance and anti-dumping procedures, have been established to protect our footwear industry.
The Deputy may be assured that the maximum use is made of all measures at our disposal to deal with any abuses which come to light.