WTO: 2016 NEWS ITEMS

DEVELOPMENT: COTTON DEVELOPMENT ASSISTANCE CONSULTATIONS


NOTE:
THIS NEWS STORY 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.

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cotton, including the sub-committee
> Agriculture negotiations: www.wto.org/agnegs
> Development: www.wto.org/development

 

 

“The Nairobi Ministerial Conference marked an important step to arrive at a negotiated global solution for cotton,” the Cotton-4 group of countries(1) said at the meeting. However, as noted at the last dedicated discussion in July, they regretted the lack of progress so far, particulary on issues where no binding commitments were made in Nairobi in December 2015. Ambassador Vitalis reiterated that for “the overwhelming majority of WTO members” an outcome on domestic subsidies for farmers at the Ele enth Ministerial Conference (MC11) in December 2017 should include a decision on cotton.

The consultations on cotton included the sixth dedicated discussion of trade-related developments for cotton(2) and the 26th session of the DG’s Consultative Framework Mechanism on Cotton

The importance of achieving an outcome on cotton at MC11 was also emphasized by ministers at a meeting in Oslo, Norway, on 21-22 October and at a meeting of the Cotton-4 ministers on 26-28 October in Bamako, Mali. The Cotton-4 said that the Bamako Ministerial Declaration made an urgent appeal for the elimination of all forms of export subsidies and domestic support for the production and marketing of cotton before MC11. Director-General Roberto Azevêdo, who took part in the Cotton-4 ministerial meeting, called on WTO members to intensify discussions and advance the progress made in the cotton negotiations in recent years. His statement is available here.

Ambassador Vitalis welcomed the recent submissions on domestic support discussed at the latest agriculture negotiations meeting on 16-17 November, which he said “show members’ willingness to take negotiations forward”. “While none of the ideas or options enjoyed consensus so far, the intensity of the debates was encouraging,” he said. 

The Cotton-4 and several other developed and developing cotton-producing countries called on WTO members to “reinforce the dynamic” in the negotiations in order to come up with a “fair and balanced outcome” on cotton at MC11.

The Cotton-4 and the least-developed countries (LDCs) group and a number of other cotton-producing countries reported on the increasing costs and economic hardships linked to cotton  in their countries, including the global  downward trend in prices. This represents a threat to efforts made by African cotton producers to enhance their competitiveness through domestic reforms, they said. Issues related to the negative impact of low polyester prices on cotton demand and cotton prices were also discussed.

According to a presentation by the Executive Director of the International Cotton Advisory Committee (ICAC) José Sette, cotton exports have remained stable over recent years and direct assistance to cotton has decreased from US$ 10.7 billion in 2014-2015 to US$ 7.2 billion in 2015-2016, although this is still the third largest amount since 1997.

 

Lack of information

The chair reiterated concerns about the “lack of critical information from key players in the cotton market” on how they support their farmers. This is “disastrous from a systemic point of view” and “highly problematic” for the negotiations, the chair said. To date, seven(3) among the 32 WTO members(4) identified as potential markets of interest for LDCs have notified their domestic support measures up to at least 2014. The chair encouraged members to reply to the cotton questionnaire that the WTO Secretariat circulates on a biannual basis.

The LDCs Group deplored the lack of updated data on the levels of members’ domestic support by category and on commitments to reduce domestic support and urged concerned members to supply the necessary information by the end of 2016.

 

Cotton development assistance

The WTO Secretariat noted that the number of committed projects and programmes has increased from 46 in July to 67 presently, as reported in Part II of the evolving table (ET) used to monitor the development assistance provided for cotton. WTO Deputy Director-General David Shark paid tribute to the donors for their commitment to the exercise and the increase in new commitments. “DG Azevêdo continues to attach special importance to the cotton dossier,” he said.

It was reported that in Part I of the ET, the ongoing cotton specific development assistance reached US$ 280 million, while disbursement flows amounted to US$ 99 million. As regards Part II of the ET, listing ongoing activities in the framework of agriculture and infrastructure-related assistance, the total value of commitments increased to US$ 4.1 billion whereas disbursements reached US$ 1.8 billion. 

Members also heard the latest updates and support initiatives that some have extended to Africa, including contributions on the platform of cooperation between developing countries in the cotton sector.

 

  1. The “cotton four” (C4) countries are Burkina Faso, Benin, Chad and Mali. Back to text
  2. The first dedicated discussion took place following the Bali Ministerial Conference Decision adopted in December 2013. Back to text
  3. Brazil; Hong Kong, China; Mexico; New Zealand; Norway; Russian Federation and South Africa. Back to text
  4. Australia; Bahrain, Kingdom of; Bangladesh; Brazil; Canada; China; Colombia; Egypt; the European Union; Hong Kong, China; Iceland; India; Indonesia; Japan; Kenya; Korea, Republic of; Malaysia; Mauritius; Mexico; Morocco; New Zealand; Norway; Pakistan; Peru; Russian Federation; South Africa; Switzerland; Chinese Taipei; Thailand; Turkey; United States and Viet Nam. Back to text

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