Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

WTO Upholds Complaint Over Cotton Aid
AP ^ | Mar 3, 2005 | Vivian Sequera

Posted on 03/03/2005 9:16:38 PM PST by hedgetrimmer

The World Trade Organization (news - web sites) on Thursday upheld a ruling condemning government help for cotton producers in the United States, saying that many U.S. programs include illegal export subsidies or domestic payments that are higher than WTO rules allow.

The WTO appeals body rejected a U.S. attempt to overturn a September 2004 ruling by an independent panel of trade experts, which acted on a complaint from Brazil.

Richard Mills, spokesman for Acting U.S. Trade Representative Peter Allgeier, called the decision disappointing.

"Negotiation, not litigation, is the most effective way to address distortions in global agriculture," Mills said in an interview.

The National Cotton Council of America, a U.S. industry body, also said it was disappointed with the ruling, but a high-level Brazilian official called it a strong move toward ending subsidies rich nations give their farmers to the detriment of farmers in developing countries.

"It is a step toward the end of the distortions created by subsidies," Roberto Azevedo, a top trade official with Brazil's Foreign Ministry, told reporters in the capital of Brasilia via teleconference from Geneva.

Azevedo and the president of a Brazilian cotton growers association said the United States must now must now take steps to abide by the ruling.

"The American subsidies are distorting the market, and harm producers in emerging countries, including Brazil," said Ronaldo Espirandelli, president of the Sao Paulo state cotton producers association.

Brazil had alleged that the United States kept its place as the planet's second-largest cotton grower and largest exporter because the U.S. government paid $12.5 billion in subsidies to American farmers between August 1999 and July 2003 alone.

The United States had insisted that its payments to farmers are within permitted levels, claiming many are not subsidies as defined by WTO and so should have been excluded from calculations of government aid.

But in a 301-page report, the WTO panel upheld the earlier ruling that some U.S. credit guarantee programs for cotton and other items are export subsidies because they are provided at rates that did not cover the long-term cost of running the program.

Washington lodged its appeal in October 2004 to WTO, whose 148 members set the rules for global commerce and are meant to fall into line with its decisions — or face potential trade sanctions from the winner if they fail to do so. Thursday's appeals body ruling is final.

"We will study the report carefully and work closely with Congress and our farm community on our next steps," Mills said.

He also chastised Brazil.

"Those who live in glass houses shouldn't throw stones," he said. "Brazil itself is heavily involved in financially supporting its farmers."

Cotton has emerged as a key issue at WTO, pitting rich against poor, as the organization's members try to draft a wide-ranging treaty to liberalize global commerce. The treaty talks, launched in Doha, Qatar, in 2001, aim to slash subsidies, tariffs and other barriers to global commerce, and to use trade to help poor nations.

"Getting the results that our farmers want is best achieved through ambitious global agricultural reform through ongoing multilateral trade negotiations which address market access, export competition and domestic support, including for cotton," said Mills.

Under an accord last summer, WTO members set up a special committee to deal with cotton within the global body's broader agriculture negotiations. The committee is meant to look to a proposal from West Africa for the elimination of export and domestic subsidies by rich producers.

Poor nations say subsidies in rich nations cause artificially low international prices and hurt farmers in developing countries because rich country producers are able to "dump" their cheap cotton on the world market.

Campaigners have long urged the United States to change its rules.

"The debate is over," said Celine Charveriat, head of the fair trade campaign at development charity Oxfam. "The United States must now move quickly to reform its programs and stop dumping cheap cotton onto world markets that undermine the livelihoods of poor farmers in the developing world."

"U.S. subsidies have distorted global markets, failed to save small U.S. farmers, and promoted environmental damage. The U.S. should see this ruling as an opportunity for reform," Charveriat said.


TOPICS: Business/Economy; Foreign Affairs; News/Current Events
KEYWORDS: cotton; distortions; freetrade; oxfam; trade; wto
"The debate is over," said Celine Charveriat, head of the fair trade campaign at development charity Oxfam. "The United States must now move quickly to reform its programs and stop dumping cheap cotton onto world markets that undermine the livelihoods of poor farmers in the developing world."

So Viet Nam and Thailand can dump shrimp on US markets and thats ok, but if the US produces cotton more cheaply than third world countries, that isn't ok.
1 posted on 03/03/2005 9:16:38 PM PST by hedgetrimmer
[ Post Reply | Private Reply | View Replies]

To: hedgetrimmer

Washington lodged its appeal in October 2004 to WTO, whose 148 members set the rules for global commerce and are meant to fall into line with its decisions — or face potential trade sanctions from the winner if they fail to do so. Thursday's appeals body ruling is final.

148 WTO members voted to tell the USA we can't run our own country as we see fit. Final answer.
I say we show them the finger as our final answer.


2 posted on 03/03/2005 9:23:50 PM PST by o_zarkman44
[ Post Reply | Private Reply | To 1 | View Replies]

To: hedgetrimmer
WTO lets "poor" countries push "rich" countries around.

Poor countries want "to build concrete content on development questions, specific commitments, concrete deadlines" from richer nations on agriculture and development issues, Kenyan Trade Minister Mukhisa Kituyi said.

"For developing countries and particular Africa ... trade is life," he said. "People don't appreciate when we say we need fair trade, we need abolition of farm subsidies. Our poverty in anchored on inbalanced trade

Manesser, who is set to present the poor nations' demands at the Mombasa talks, said a refusal by the west to concede would doom the Hong Kong ministerial to failure.


Is the WTO really about free trade?
3 posted on 03/03/2005 9:25:31 PM PST by hedgetrimmer
[ Post Reply | Private Reply | To 1 | View Replies]

To: hedgetrimmer
On Friday, ministers will discuss farm subsidies, which poor nations are demanding rich countries massively cut, arguing that the subsidies undercut the competitive advantage of one of their main revenue sources.
4 posted on 03/03/2005 9:28:42 PM PST by hedgetrimmer
[ Post Reply | Private Reply | To 3 | View Replies]

To: o_zarkman44
148 WTO members voted to tell the USA we can't run our own country as we see fit

Ain't global government grand!
5 posted on 03/03/2005 9:42:39 PM PST by hedgetrimmer
[ Post Reply | Private Reply | To 2 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson