Europe threatens salmon farmers

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Scottish and Irish fish farmers claimed yesterday that 7,000 jobs in the industry remain at risk from a flood of cheap Norwegian salmon after the European Commission backed away from a threat to impose sanctions on Oslo.

After a crisis meeting on Sunday night, the Commission, which handles trade negotiations for the bloc, backed a five-year deal negotiated by the trade commissioner, Sir Leon Brittan. In the face of objections from Neil Kinnock, Britain's other commissioner, he recommended acceptance of the accord to avert a trade war with Norway.

Two Scottish Office ministers flew to Brussels hoping to see tariffs slapped on the Norwegians but were disappointed. "There is no denying that this is a disappointing outcome. The short-term difficulties which the industry will face are very substantial," said Brian Wilson, the Scottish industry minister.

Mr Kinnock, the transport commissioner, challenged Sir Leon's handling of the trade talks last week, and maintained his opposition to the deal to the end. He said he remained unconvinced that it offered the European Union salmon industry adequate protection against unfair competition. Emma Bonino, the fisheries commissioner, and Padraig Flynn, of Ireland, also voted against.

A majority of commissioners was swayed, however, by the argument that a five-year deal encompassing minimum prices and other safeguards was preferable to temporary duties which might not be renewed by EU trade ministers when they expire in six months' time.

Sir Leon stressed that he had secured concessions which would force the Norwegians to sell their salmon at a price higher than the rate of tariffs Scottish fish producers were calling for. He dismissed suggestions that the Norwegians would ride roughshod over the minimum price undertakings. He said the deal was "pretty watertight", triggering duties automatically if the price falls beneath a floor level and he promised constant monitoring.

These arguments cut little ice with the Scottish Office, however. Mr Wilson said it was "perverse and odd" of Sir Leon to suggest that he knew better than the fishing organisations how best to deal with dumping. "We have been down the road of minimum prices before and nobody in the industry believes minimum prices can be enforced because they haven't been in the past," he said.

Norway, which exports about pounds 500m worth of salmon to the EU each year, was found guilty of illegally dumping below cost price after a lengthy investigation by EU officials this year.

Expectations were that the Commission would inflict a 14 per cent import tax, but Sir Leon surprised colleagues at the last minute by recommending an agreement.

The change in tactics sparked the most public spat to date between the two UK commissioners. Mr Kinnock said that he and other colleagues had been given no time to consider the terms of the accord and accused Sir Leon of sidelining fisheries experts who favoured taking a tough line with Oslo.

Under the terms of the deal, brokered after intensive Norwegian lobbying at the highest political level, Oslo will have to restrict the growth in the volume of its salmon exports to about 10 per cent annually. In addition to the minimum price Oslo also agreed to a voluntary increase in export tax.