Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Wednesday, 15 May 1991

Vol. 408 No. 5

Adjournment Debate. - Tralee (Kerry) Plant.

I wish to give one minute of my time to Deputy Deenihan. I thank you for allowing me to raise the matter of the Klopman factory in Tralee during the adjournment debate.

Klopman International is a polycotton industrial firm in Tralee that exports product to a sister factory in Italy. Klopman produces 55 per cent of the polycotton of Europe. They have announced a major rationalisation of their European polycotton operations, both in Ireland and in Italy. The company have been affected by the increasing levels of fabrics being imported from low cost countries and by the dumping of polycotton on EC countries from India, Pakistan and Mexico, which countries are selling polycotton on the European market at a cost less than they are selling it in their own countries. That has resulted in fewer sales and depressed prices for Tralee Klopman. Sales from outside the EC are regulated by the Multi Fabrics Agreement — MFA, as it is known. That regulation lays down import controls to the EC from those countries.

One of the countries exporting to Europe, India, sent their quota to Europe in two months and they are exporting to Europe via other countries — getting in by the back door. Klopman, with the suport of the Confederation of Irish Industry, have complained to the EC about these irregularities and the dumping of fabric on the EC market by India, Pakistan and Mexico.

The Tralee plant employs 494 people. A decision will be made very soon on its future.

I request the Minister for Industry and Commerce, Deputy O'Malley, to use his good offices and influence to try to ensure that Klopman Tralee do not close. When the GATT negotiations take place, I ask the Minister to try to ensure the control and proper monitoring of the importation of polycotton into Europe. I request the Minister to get in touch with the Confederation of Irish Industry and to press them to get on to the EC in relation to the dumping of polycotton on the EC.

The closure of Klopman would be a disaster for Tralee, increasing the number of unemployed and seriously affecting the economy of Tralee town. Tralee and surrounding areas are suffering greatly from unemployment, and it is very important to save the Klopman industry for County Kerry.

I thank Deputy McEllistrim for allowing me one minute of his time. I remind the Minister that Tralee is now one of the unemployment blackspots in the country. At the moment the unemployment figures for Tralee and the surrounding region stand at 4,080, an increase of 966 over this time last year which represents an increase of 23 per cent. Klopman's closure would intensify this depression and, if it resulted in a large number of redundancies that would add to the problem. I request the Minister to involve his Department and the IDA as much as possible in the negotiations between the unions and management in an effort to keep the number of redundancies to a minimum and so ensure the future viability of the plant for the sake of the economy in Tralee.

I have been keeping myself informed of the situation affecting Klopman International Limited, and I share the Deputy's concern at recent developments in relation to the Tralee operation. I would, however, like to point out to Deputy McEllistrim that closure of the Tralee plant has not been proposed. What the parent company, Dominion Textiles Inc., Canada, have announced is the implementation of a major rationalisation of their European operations in both Italy and Ireland, which admittedly will result in job losses in Tralee. The House will realise, of course, that in the case of any enterprise a decision of this type is a matter essentially for the owners and management of that enterprise.

In March 1989, Dominion Textiles Inc. purchased the former Burlington industries plants at Tralee and Gillogue, County Clare. Since the purchase, the Tralee plant has operated as Klopman International Limited employing 494 people at present in the production of polycotton fabrics for the work wear and leisure wear markets. The former Burlington dyeing plant at Gillogue has remained idle since 1985.

Over the last two years Klopman have being experiencing very difficult trading conditions caused by recession in the UK market and competition from low cost sources, principally India, which has resulted in depressed prices in Europe for the company's product. This has led to the company's recent announcement of their rationalisation programme. The reduction in output at the group's Italian plant will result in the loss of some 300 jobs there. I understand management are seeking a reduction in the working week in Tralee from seven to five days which will result in about 115 redundancies and some reduction in earnings for the remaining workforce due to loss of shift allowances.

I am fully conscious of the adverse impact both economically and socially of the proposed rationalisation plan in the Tralee area. I can understand the disappointment of those affected and I sympathise with them. However, management insist that the implementation of their rationalisation plan is vitally necessary in order to maintain a viable operation in Tralee and I am sure the Deputy will appreciate that the company must react to the market situation. Moreover, it is important that necessary corrective action is taken now since delay could lead to the necessity for more drastic action at a later stage.

In this regard, I am particularly concerned that official strike notice has been served on the company. While I can understand the frustration of the employees concerned at this difficult time, industrial action would not be helpful in the context of the parent company's review of the Tralee operation and I would appeal to the employees and to the unions concerned not to damage the future prospects of the company and the plant by going on strike within the next day or two as is apparently proposed.

As already mentioned, a major factor giving rise to the company's current difficulties is the increase in imports from low cost sources. This is a consequence of the ongoing liberalisation of trade in textiles in the context of the multifibres arrangement which governs international trade in this area. Notwithstanding this, my Department have had ongoing contacts with the company to ensure that all possible protective trade measures were applied to assist them. We have had limited success in this area but, of course, the Deputy will appreciate that decisions in relation to the introduction of trade measures are taken on the basis of strict economic criteria which must be agreed at EC level and I must regrettably say that other member states, in particular in this case the UK and Italy, have not always shared our concerns in the matter.

As the House is aware, the multilateral system for trade in textiles is currently under review in the context of the negotiations on the Uruguay Round and a commitment has already been given for the eventual integration of trade in textiles into GATT on the basis of strengthened GATT rules and disciplines. The position adopted by the Community, which is supported by Ireland, is that integration should take place smoothly in order to create confidence and predictability, which is important for business both in importing and exporting countries. I can assure the House that Ireland attaches particular importance to the need for the strengthening of GATT rules and disciplines in relation to selective safeguard mechanisms, anti-dumping measures, subsidies, etc., which would allow for a system of genuinely fair trade. We maintain that the duration for the phasing out of existing restrictions should depend on the extent to which these GATT rules and disciplines are strengthened.

To return to the current difficulties faced by Klopman International Limited, I can assure Deputies that I am keeping in very close touch with developments. Both the IDA and my Department will continue to keep in regular contact with the company to assist them, as far as possible, in dealing with their present difficulties in an effort to secure their future viability and to keep job losses to a minimum.