Bridges Weekly Trade News Digest • Volume 9 • Number 23 • 29th June 2005
WTO Cotton Sub-Committee: African Group Urges Response To New Proposal
The WTO Sub-committee on Cotton held its fourth meeting on 22 June 2005. At the gathering, African countries expressed disappointment at the lack of written responses to their latest proposal calling for major reforms in the trade of cotton, circulated prior to the group’s 29 April meeting (see BRIDGES Weekly, 4 May 2005). Negotiators from Benin, Burkina Faso and several other African delegations, supported by their counterparts from Brazil and Argentina, said that unless other countries produced alternative proposals in writing they would be unable to report on the progress of the sub-committee to their governments.
Meanwhile, outside the WTO, the African Union reiterated the proposal’s demand that the US eliminate its cotton subsidies by the WTO Hong Kong Ministerial Conference in December (see BRIDGES Weekly, 15 June 2005).
US urges ambition in overall agriculture negotiations
The US said it was reluctant to submit written proposals either in the cotton sub-committee or in ongoing consultations among key delegations in the broader agriculture negotiations. This was because it wanted to avoid repeating what happened before the 1999 Seattle Ministerial Conference, where Members stated their positions in writing and then found it difficult to retract from those positions. The US argued that the outcome for cotton would be determined by the overall agriculture negotiations, where reductions in specific areas such as domestic support would affect US cotton programmes. Stressing that the African proposal was ambitious and unlikely to be achieved in the long term, the US said, however, that the talks could inch closer to the aims of the African proposal if Members were ambitious inthe agriculture talks.
Chair Tim Groser (who currently chairs both the Cotton Sub-committee and the Committee on Agriculture in his private capacity), agreed to the EU suggestion that the proposal could be more effectively discussed in a smaller group consultation. He said he might hold such a consultation later on, when Members would be better positioned to assess how developments in various areas of the agriculture negotiations could affect cotton.
Sub-committee discuss development aspects of cotton
On the development aspects of cotton, the International Monetary Fund (IMF) outlined the result of a conference on cotton in Cotonou, Benin on 18 May 2005. It said that meeting participants had agreed on the following "four-pronged response" to the surge in cotton production and decline in prices: preserving macroeconomic stability by tackling poverty directly rather than supporting prices in order to avoid adjustment; using development programmes to increase production efficiency andcompetitiveness; eliminating distorting export and domestic subsidies in developed countries; and protecting the poor during adjustment.
The next Cotton Sub-committee meeting is scheduled for 18 July 2005.
ICTSD reporting.