On Monday 9 November European Union trade and business ministers met in Brussels to discuss a common European response to the crisis hitting the steel sector. This ‘steel summit’ took place exactly four weeks after it was announced that steel production in Redcar would end, leaving 2,200 jobless across Teesside.
European steelworks have been under growing pressure in recent years as imports of cheap steel from China skyrocketed. Massive state subsidies have led the country to produce far more steel than it needs. In fact, China now produces more steel than all other countries in the world put together. As a result prices have dropped dramatically and Chinese steel is now sold below production price in the EU, a practice known as dumping that is prohibited under international and EU trade rules.
After spending months blaming the EU for all the ills of UK steel, the UK government was finally compelled to shelve its EU referendum agenda for a moment and seek the support of its European counterparts. What it got was a clear rebuttal of its main excuse for inaction. In calling for making the best use of EU state aid rules to address the crisis, EU trade and business ministers confirmed what Labour has been arguing all along: the UK government is perfectly able to step in and invest to save steelworks on the brink of collapse without contravening EU rules.
But when it comes to the EU’s direct responsibilities the meeting was unfortunately far less fruitful, as the only concrete decision taken at the steel summit was to convene a second ‘steel summit’. Holding meetings after meetings without taking concrete action will not be of much use for the steelworkers whose jobs are on the line. The EU must act now to beef up its protection against unfair competition.
The ministers hinted at deploying in full the EU’s existing trade defence instruments. Some steel products are currently protected, with the commission levying large anti-dumping duties on goods coming from China. But the commission’s approach has been piecemeal, targeting only specific products such as ‘cold-rolled flat products’ or ‘welded tubes and pipes’, and not always very timely with anti-dumping investigations typically taking months or even years before duties are actually imposed.
Overall, there is an urgent need to reform the EU’s trade defence instruments. Such a reform was adopted by the European parliament in 2014 but it needs the EU ministers’ approval to be implemented. The reform would raise anti-dumping tariffs, give trade unions the right to initiate dumping investigations and introduce protection against social and environmental dumping. It has been blocked by EU ministers for 18 months.
Empty gesturing has already cost the UK thousands of jobs, and Monday’s meeting was sadly another missed opportunity to stop gesturing and start acting to resolve the crisis. The UK government has the ability to do to so, whether in providing much needed aid to ailing businesses or in legislating together with the other EU countries to build new protections against unfair competition.
Jude Kirton-Darling is a member of the European parliament for north-east England. She tweets @Jude_KD
Progressive centre-ground Labour politics does not come for free.
Our work depends on you.