by Ranjit Sidhu
It was just a couple of months ago, in February this year, that it was reported the UK government was central to sinking the European Union’s initiative to increase tariffs on dumping by Chinese companies, such as with steel.
Then, as now, Sajid Javid justified it’s stance with the familiar neo-liberal economic line that increasing tariffs would hit UK businesses by making the steel they purchase more expensive and that it would be wrong to put tariffs in the way of the cleansing winds of the free trade.
It is a familiar argument that has held sway over British politics ever since it was used to bludgeon the coal industry out of existence in the 1980s.
The stance on trade in the Conservative manifesto of “pushing for freer global trade” gave ethical backing for the policy driven by the chancellor George Osborne on China, nicknamed “The Osborne Doctrine”.
At core the policy was to push under the carpet human rights and other ethical differences, become China’s “best partner in the west” by, for example sinking any new European tariffs on Chinese companies, allow Chinese companies to invest in the UK’s critical infrastructure, then hope the Chinese reciprocate by allowing UK companies into the fiercely guarded internal market – everybody wins.
Except, Port Talbot shows they don’t.
Why this policy inevitably led to events like the potential closing down of Port Talbot is obvious when you look a bit deeper into the economics of steel production: the largest Chinese “companies” that produce steel are Baosteel and Hebei Iron and Steel, both are completely state owned and run organisations.
