Trade body TUC urges Govt to hold special manufacturing summit take on Chinese challenge

30 Jun '05

3 min read

The TUC is today (Tuesday) calling on the Government to host a special manufacturing summit to examine how British industry can prepare itself to tackle the threat to companies and jobs posed by the rapidly expanding Chinese economy.

The call comes in 'China, Europe and UK Manufacturing', a TUC report being presented in a speech today to a Manufacturing Institute Conference by TUC Chief Economist, Ian Brinkley. The report says that employers are wrong to think the UK can compete with the Far East by forcing down labour costs or blocking new workplace rights. The only effective response is to put more money into skills, research and development, and innovation.

'China, Europe and UK Manufacturing' say that companies in Germany, often cited by UK employer organisations as among the most heavily regulated in Europe, have won export markets in China, at a time when UK exports have struggled.

German manufacturers have nearly doubled exports to China by value in the last five years, a growth rate of more than five times that of the UK. France and even Italy have been more successful than the UK, says the report.

TUC Chief Economist Ian Brinkley said: 'China is a growing economic force, but we cannot meet its challenge by becoming even more of a low regulation, low tax economy. Firms in other European countries have shown they can sell to China and take advantage of its new wealth.

'Chinese competition certainly poses real threats to manyUK firms, and too few employers are doing enough to ensure manufacturing's long-term survival. We need to invest in the things that matter like skills, research and innovation. And while each firm has to make and sell its own products, it is right to ask how government and the sector can work together to make the changes needed. That is why we need a special summit to help focus minds and enable everyone to work together.'

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