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Cotton and the WTO: What has been Achieved?
Textiles Intelligence, March 2006, Pages: 20
The issue of cotton subsidies in developed countries is one of the most contentious and challenging ones for the World Trade Organisation (WTO). In the past the WTO has maintained that cotton should not be considered separately from other agricultural products, and the USA has supported this stance. However, the WTO stance was formally broken at the Doha Round ministerial conference in Hong Kong in December 2005, after a concerted two-and-a-half-year campaign by four West African cotton producing nations—Benin, Burkina Faso, Chad and Mali, known collectively as the C-4 group. The C-4 group was aided in its campaign by a legal challenge launched by Brazil against US cotton support policies in 2002. Brazil’s challenge helped to raise the profile of the C-4 group’s campaign and to secure worldwide coverage and widespread sympathy for the plight of the C-4 countries. All agricultural export subsidies will be eliminated by 2013 and domestic subsidies gradually reduced. In the case of cotton, developed countries are to eliminate export subsidies in 2006. Also, they will grant duty-free and quota-free access to exports from least developed countries (LDCs), although no timetable for this has been agreed. Domestic subsidies aimed at encouraging cotton growing will be gradually eliminated, and the WTO will find a way of channelling development assistance in order to mitigate poverty and improve the competitiveness and efficiency of cotton growing in least developed countries. However, some of these ambitions are likely to be strongly opposed in developed countries. Achieving them could therefore prove challenging.
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