South Wales steels itself for industrial decline post-Brexit

South Wales steels itself for industrial decline post-Brexit
By Valérie Gauriat with Robert Hackwill
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South Wales, like many traditional European centres of heavy industry, has suffered in the last 30 years as plants have closed and jobs have been lost. In some cases EU development funds have stopped

Save British Steel!

This is what a few hundred steelworkers gathered in London came to ask the government recently.

A month earlier, the Indian group Tata Steel announced its intention to sell or close all of its loss-making production sites in Britain, threatening some 15,000 jobs.

“The steel industry in the UK is at a crossroads. We could end up with steel making stopping in the UK. We’re here to make sure that doesn’t happen,” says the Unite trade union’s Mark Turner.

“We’ve been asking for help for a long period of time now and it’s fallen on deaf ears. We have had promises but they haven’t come to fruition. Now is the time to act, now is the time to go forward,” says steelworker Steve Davies.

To be or not to be part of the European Union ? Can it change anything to secure the future of British steelworkers? We came to ask them in Port Talbot, their stronghold in South Wales.

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Thousands of jobs throughout the region depend on this giant plant. This is where we meet Steve again.

He started as an apprentice at the steelworks 37 years ago; his parents were employed there, his son works there today.

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“There’s a lot of other people who had 4,5,6 generations within the company. Without Port Talbot steelworks, there’s no Port Talbot. The knock-on effect will be catastrophic, businesses will go bankrupt. It’s not just the steelworks, it’s the lorry industry, the corner shop, newspaper shops, hairdressers. It’s not just the little picture of the steelworks, it’s the whole picture we’ve got to be looking at and saving.

We do need to stay in the EU. We’re looking for potential buyers. And I think that it’s very important for them that they know that we’ve got that foothold in Europe as well,” says Steve.

There’s the rub. This industry along with coal made South Wales a global industrial powerhouse in the 19th century, leading to a rise in organised labour, making the region one of the birthplaces of trade unionism, and spawning several generations of leading Labour politicians. Conservative governments have not been in much of a hurry to help a region that does not vote for them.

But fortunately at times there has been an alternative to Westminster; Brussels. Hit by the fall of the mining industry in the 80s, and the closure of steel plants at the start of the century, Wales is one of the regions which benefits the most from European Structural Funds.

Support that in the eyes of many, does not lift the uncertainties over the economic future of the region.
Many here are sceptical of the European stance of a government which they say has done nothing to support the British steel industry.

Vote Leave campaigners told us that 70% of the local population would vote for a Brexit. So we went to check this out at a steelworkers’ café.

“Sharon Evans has been running the Dock’s Café near the Tata steelworks for 5 years. she has no opinion on the possible advantages or disadvantages of a Brexit, allthough many of her customers are for an out. She says her only concern is for the steelworks and all the businesses which like hers depend on them, to survive.”

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Few are willing to speak out publicly. Off camera, opinions are divided, and supporters of Brexit who do talk to us are mostly driven by their anger against the Cameron government.

“The government are not doing anything for us. It’s constantly against us. So we just need to stand up now and say enough is enough. Let’s vote out of Europe and stand on our own two feet. We’ve got to look at where the money is coming to in the UK. As long as we can save money in the UK, and not give to the European union, at this moment in time, we need to get Britain back on track and back on its own two feet,” says garage owner Paul David Smith.

Indian-owned Tata Steel is the second-largest steel producer in Europe, where it exports more than 40 percent of its products.

For this economist, a Brexit would not kill the industry but could deprive it of its main outlets.

“I think it’s going to be a steel industry of some sort in the UK, whether we remain in or out of the EU. The question is if the economy will be growing quicker, and as a result we are likely to have a more successful industry if we remain in the EU. Many firms in this part of the world, whether Sony or other companies, multinationals, many came to this part of the world because of the EU. If we leave the EU, we’re likely to see inward investment into Wales fall, and inward investment not just in steel, but in the car industry, etc,” says David Blackaby.

We meet Vote Leave activists in the city centre.
Whether it concerns the rules on competition, state aid, public procurement, or the lack of anti-dumping measures, they say EU regulations only hamper the steel industry.

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“Up the road now they’re building a new windfarm with Chinese steel because they went out to procurement laws. We couldn’t demand that we use the steel made here in Port Talbot, it’s only a few miles away. There’s business rates as well. We couldn’t reduce the business rates on the steel on the simple basis it’s against the EU state aid law. We couldn’t make an unfair bias towards one of our own steelworks. So if we left the European Union we could reduce business rates, we could start using our own steel on our own developments, whatever it be, rail, windfarms, mining. There’s lots of benefits if we leave the European Union to save our steelworks,” says UKIP member Llyr Powell.

“The biggest problem is the EU business regulations, especially things such as energy regulations that have had a hugely detrimental effect on all energy intensive industries. We can’t employ any anti- dumping measures without the consent of the commission or the EU because it’s an exclusive competency of the European union. Outside of the EU we would be able to refer to the World Trade Organisation rules which would allow us to levy much higher tariffs, like they’ve done in America to protect their industry,” says Vote Leave’s assistant director for Wales, Morgan Brobyn.

The United States imposes tariffs of 236% on Chinese steel imports, against 20% in the European Union.

Brussels wants to raise that threshold, but the British government is the one most opposed to it, points out the constituency’s Labour MP. A Brexit would cost the British economy dearly he says.

“If you come out of the European Union, you then have to start trying to agree what the trading relationship looks like. Are we in the Single Market, are we not? If we’re not, what kind of tariffs do we have to pay? What sort of tariffs do we have to pay on steel? What sort of tariffs do we have to pay for example on every car that we export, which is a major part of what the Port Talbot steel works produces. Most of their customers are in the automotive industry. You’ve got a situation where in my opinion it would be the killer blow,” said Aberavon MP Stephen Kinnock.

“Huw and Amanda, owners of the Taste Brasserie in Port Talbot. Like many of their customers, they are undecided about how they will vote. The couple has organised debates on the issues at stake in the EU referendum at the Brasserie”

Scott Bamsey is the youngest union representative at the Port Talbot steelworks.

His family has worked in the industry for generations. Like many, their views on the European Union are mitigated. But a Brexit they say, would be too risky.

“The Bamsey family have been working at the steelworks for generations. They want the UK to remain in the EU, as they feel an exit would carry too many risks for the British economy.”

“If we are out of Europe we have no say in what they do in Europe. So I think we need to stay in Europe and fight to block the Chinese dumping,” says Scott.

“We need to be in the European market, we don’t want to be scratching out at finding other markets, in Asia, America, Canada,” says father Peter, now retired.

“Pulling out of Europe would just pull so many unknowns. It’s safer where we are. Obviously we’d have to strike new trading deals and it would just make a complicated situation even worse. So I think to stay in would be the best option for us, and the steel industry,” adds Scott.

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