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WTO: 2005 NEWS ITEMS

28 October 2005
WTO COTTON SUB-COMMITTEE

African cotton proponents hail ‘landmark’ progress on development

The African proponents of the cotton initiative have welcomed progress on the developmental side of the initiative, saying this aspect of the 1 August 2004 framework is finally taking shape, the Cotton Sub-Committee learnt in its seventh meeting on 28 October 2005.

NOTE:
THIS NEWS ITEM IS DESIGNED TO HELP THE PUBLIC UNDERSTAND DEVELOPMENTS IN THE WTO. WHILE EVERY EFFORT HAS BEEN MADE TO ENSURE THE CONTENTS ARE ACCURATE, IT DOES NOT PREJUDICE MEMBER GOVERNMENTS’ POSITIONS. THE OFFICIAL RECORD IS IN THE MEETING’S MINUTES
  

> Cotton Sub-Committee
Mandate (July-August 2004 framework, paragraph 1.b and Annex A paragraph 4)
Background explanations in the agriculture negotiations backgrounder

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Pascal Lamy's speeches


Development issues back to top

The four African countries (Benin, Burkina Faso, Chad and Mali) described the progress as “landmark” in a meeting on the development aspects earlier the same day, the WTO Secretariat reported to the sub-committee. Summarizing the earlier consultations, Chiedu Osakwe, director of the DDA Special Duties Division, told the sub-committee that bilateral and multilateral donors had reported a number of new contributions and projects for dealing with cotton.

These are being provided bilaterally by individual countries (US, EU and Japan) and multilaterally by international organizations (African Development Bank, IMF, OECD, UNIDO, World Bank). Mr Osakwe described this as real progress in contributions and concrete indications of further advances.

The separate consultations on the development aspect are chaired by Stuart Harbinson, special advisor to Director-General Pascal Lamy.

Uganda (in the earlier consultations) and Zimbabwe (in the sub-committee) complained that development efforts are only focusing on some (West) African countries whereas cotton is grown in other countries as well. Amb.Falconer pointed out to the sub-committee that on the trade side the elimination of export subsidies and cuts in domestic support will benefit all non-subsidizing producers and, on the development side, that donors had said they will respond to proposals for assistance from all countries.
  

Trade issues back to top

The chairman’s report on the agriculture negotiations: On the trade side, chairperson Crawford Falconer said latest developments in the agriculture negotiations could have an impact on cotton, although details are yet to be worked out.

The elimination of export subsidies has already been agreed.

On domestic support, where positions have moved within a range that allows genuine negotiations, cuts in developed countries’ trade distorting “Amber Box” subsides would include cuts on cotton. For the “Blue Box” (supports with production limits or not requiring production) the question is whether an appropriate balance can be found between the size of cuts and the disciplines — combined with Amber Box cuts that could constrain domestic supports, Ambassador Falconer said.

On market access, where key members were trying to narrow their differences, so far there had been nothing like convergence; but if progress can be made, then developing country cotton producers should benefit in two ways, he said. They would gain from agreement to improve market access, and agreement on this would unblock the talks and make agreement possible on export competition and domestic support, he added.

The discussion: The EU repeated its proposal to “frontload” (implement what is agreed earlier) for cotton. From the first day, it proposed eliminating export subsidies on cotton and implementing the reductions on domestic support on cotton that would be phased in for other products. On the market access side, cotton and cotton products from all developing and least-developed countries would enjoy quota-free, duty-free access, the EU proposes.

The EU urged the African proponents to recognize this as a formal proposal that has been repeated orally in three successive meetings and recorded in writing in the minutes of previous meetings. The Africans had described the proposal as “new” and urged the EU to put it in writing.

The African proponents said conditions in their countries’ cotton sectors are deteriorating and said they were anxious to see concrete results at the Hong Kong Ministerial Conference. Amb.Falconer agreed that while the agriculture negotiations provide the context for reform on cotton, the 2004 agreed framework requires additional concrete results on cotton. He said he would continue to hold consultations on the subject; he held consultations recently and plans to hold more as soon as possible.

Brazil and Australia, speaking for the G-20 and Cairns Group, said the cotton initiative would also benefit from limits on Amber Box payments on specific products and on disciplines on the Blue Box.

  
Next meetings back to top

18 November

  
Chairperson: back to top

Ambassador Crawford Falconer of New Zealand, formally elected at this 28 September 2005 meeting, who also chairs the agriculture negotiations.

 

Some of the groups: back to top

See also agriculture negotiations backgrounder

PROPONENTS: Benin, Burkina Faso, Chad, Mali

AFRICAN GROUP (41 countries): Angola, Benin, Botswana, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Congo, Congo (Democratic Republic), Côte d’Ivoire, Djibouti, Egypt, Gabon, The Gambia, Ghana, Guinea, Guinea Bissau, Kenya, Lesotho, Madagascar, Malawi, Mali, Mauritania, Mauritius, Morocco, Mozambique, Namibia, Niger, Nigeria, Rwanda, Senegal, Sierra Leone, South Africa, Swaziland, Tanzania, Togo, Tunisia, Uganda, Zambia, Zimbabwe

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