WTO Delegates Perform Cotton ‘Ritual’

9 June 2010

WTO Director-General Pascal Lamy told trade delegates in a fax on 12 May that cotton has become a "litmus test" for the "development dimension" of the Doha Round. At a recent review of the issue's standing in WTO talks, some countries, such as Tanzania, alleged that no progress has been made since 2005.

Leonce Kone, the trade minister from Burkina Faso - a cotton-exporting Least Developed Country (LDC) - joined Geneva-based trade delegates in consulting with WTO Deputy Director-General Harsha Singh on 7 June. These consultations are part of the work of a Sub-Committee on Cotton, which was mandated in the General Council's July 2004 framework agreement to conclude the Doha Round. The committee's remit is to review "all trade-distorting policies affecting the sector in all three pillars of market access, domestic support, and export competition."

The consultations are intended to feed into a broader process that allows WTO members and donors to gauge progress on cotton - specifically with regards to trade,development, and the need for domestic reforms. Many developing country members used the 7 June meeting to express concern over the lack of attention that the issue has received in recent years.

Brazil, which is engaged in negotiations to settle a WTO dispute with the US on cotton, called developed country subsidies an unfair source of competition for developing country farmers, while suggesting that consultations in the negotiations have backtracked.

A delegate from a cotton-growing African country told Bridges that the Sub-Committee on Cotton's meetings were "becoming a ritual, a tradition" that may not produce any real outcome.

The United States, the world's largest subsidiser of cotton, repeated on Monday its position that WTO agriculture talks in all other major areas should be resolved before negotiators turn to cotton. However, many developing countries insist that a reduction in subsidies, particularly on cotton, is necessary to address the development objectives of the Doha Round. The US will be paying nearly US$150 million each year to Brazilian farmers to compensate them for the market-distorting effects of its subsidies. However, the US has yet to counter a proposal to eliminate subsidies at a faster rate for cotton, which was made by the Cotton-4 (C-4) group of West African producers.

Tanzania insisted that development assistance without cuts in domestic support would lead nowhere, a common refrain among other developing country members.

Director-General Lamy, in a letter to WTO ambassadors, reminded them of the growing amount of development assistance that is being offered on cotton, even during the global economic and financial crisis. According to the WTO, the disbursement of funds for cotton-related assistance has increased by 24 percent to US$ 266 million from the last such report.

Brazil, India and China have emerged as contributors to a platform on South-South Cooperation on Cotton Sector Development. For China, this has meant support on agricultural research and development projects in Africa, private sector investment, interest free loans and training. On Monday, China committed to "enlarge the scale of ... and improve the efficiency of...aid" in the sector.

Pakistan, also a major producer of cotton, tabled a proposal to assist in agricultural research and development among West African producers through the use of its domestic facilities on cotton.

Burkina Faso's Minister Kone, speaking on behalf of the C-4, summed up a sentiment shared by many developing country members in observing that the present rhythm of the negotiations does not provide grounds for optimism.

ICTSD reporting.

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