Freesteel Blog » A machine tool Iraq debacle

A machine tool Iraq debacle

Monday, December 24th, 2007 at 11:27 pm Written by:

Found in the business newspaper clipping section of Dublin public library circa 1992:

Britain’s machine tool industry has been decimated by the loss of business resulting from embargoes of Iraq.

In 1986 the UK machine tool industry had no exports to Iraq. This was before the Department of Trade and Industry sponsored British companies to take part in Iraq’s first international trade fair following the end of the Iran-Iraq war.

In the space of two years UK machine tool manufacturers were enjoying sales of £31.4m, promoting Iraq to number three after the US and West Germany in the table of Britain’s machine tool export markets.

Most of Britain’s machine tool makers had exports to Iraq at the time. Many of the exports were being used for the manufacture of munitions.

Seven years later, with the iraqi market destroyed and with the refusal of the government to countenance a new market in Iran, the UK survivors of the high technology end of the industry can be counted on one hand.

Matrix Churchill, the company with the biggest Iraqi orders, is in receivership; Wickman Bennett, of Coventry has also ceased production. It agreed a fine with Customs and Excise over exports to Iraq.

Mr David Phillips, an industry consultant, estimated that two thirds of the UK machine tool industry, representing annual turnover of about £600m, had been wiped out in the Iraqi debacle.

I guess those were the days when the machine tool industry was a political force to be reckoned with. (Before my time, before I even knew what a machine tool was.) Does it explain why there is an unlikely concentration of machine tool software companies in this country? These things get established, and persist for decades.

Anyway, the story from the article corroborates with some Parliamentary questions. For example, from 3 December 1990:

Mr. Dave Nellist (Coventry, South-East) : Leaving aside how British troops in the Gulf must now feel towards the hon. Member for Plymouth, Sutton (Mr. Clark), and the fact that the occasion of this statement is not only a good occasion for his resignation but another good reason for not drifting senselessly towards war in the Gulf, how can this Minister now face the 89 workers and their families from Matrix Churchill in Coventry who this weekend were given notice of their redundancy, which will take effect four weeks today? The Minister seems to have done nothing in the five weeks since I led a deputation of workers to him in his office. Is it not a fact that his Department encouraged general exports to Iraq, including machine tools and lathes from Matrix Churchill and Wickman Bennett? Is it not a fact that in November 1988 the former Secretary of State for Trade and Industry announced £400 million in credit to enable those exports to be made and that 10 days before the present Secretary of State for Health said in the House that the Iraqis were using chemical weapons to bomb the Kurds? Is it not a fact that the Department allowed the Iraqi secret service to take over Matrix Churchill? Is it not also a fact that, after sanctions were imposed in August, the Government washed their hands of the responsibility for workers in Coventry and elsewhere? As it is all the Government’s responsibility, should not the Minister announce today that the Government will take over the firm, take it out of the hands of the Iraqi secret service, and guarantee the jobs and livelihoods of the workers in Coventry and elsewhere?

The Minister for Trade (Mr. Tim Sainsbury): Job losses and redundancies are always a matter for regret and I am sorry to hear what the hon. Member for Coventry, South-East (Mr. Nellist) said about some of the workers in Matrix Churchill. The hon. Gentleman read out a list of “facts”, most of which I did not recognise as facts.

And also, from a written question 24 November 1992:

Mr. Robert Ainsworth: To ask the President of the Board of Trade if he will make a statement about his Department’s handling of Wickman’s export licence to Iran.

Mr. Needham: No. This Department does not make statements in public about individual export licence applications.

Bob Ainsworth is now a Minister of State in the MoD where he has deplored the alleged supply of weapons from Iran over the border in Iraq where they are used “kill our people”.

Presumably, as long there were no British people getting hurt, and the manufactured munitions were killing no more than Iranians or Iraqis (depending on which side guaranteed our jobs), it was perfectly all right.

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