Brussels, 08/09/2003 (Agence Europe) - After Paris, a delegation of representatives from four African cotton producing countries - Benin, Burkina Faso, Mali, Chad - met in Brussels last week to press the case with the European Commission for survival of African cotton, which is threatened by dumping practised by rich countries on the world market with the help of subsidies to their own producers (see Saturday's EUROPE, p.11).
Just a few days from the opening of the fifth WTO ministerial conference in Cancun (Mexico, 10-14 September), the aim of the delegation, which is composed of diplomats, representatives of African countries and development NGOs for the South, was to solicit the support of the European Union for the tender introduced in May by the four WTO countries calling on rich countries - especially the United States and Australia - to put an end to their subsidies which are at the origin of unfair competition that threatens the survival of tens of millions of African producers. After having been received by the cabinets of European Commissioners Pascal Lamy (Trade) and Poul Nielson (Development), the delegation was to continue its campaign in The Hague (the Netherlands) and in Washington (United States) before returning to Cancun where the issue will be tackled. The four countries have in fact - and this is a first victory - managed to have the matter added to the agenda of the WTO conference. This approach, approved by all countries of West Africa and Central Africa, is supported by all the least developed countries. In addition to an end to subsidies, it aims to have the status of "special product" given to cotton (i.e. a product essential to development) for the countries of West and Centre Africa, and special treatment that ensures there is fair access for cotton on the world market, as well as compensation for losses by the cotton-producing countries. During a press conference in Brussels organised by the British NGO Oxfam International, the members of the delegation explained that the subsidies of rich countries, which amount to $4 billion, have a depreciating effect on the price of cotton on the global market. This has caused a loss of $1 billion in income in these four African countries, which are among the poorest.
"Cotton is not just a farm product for our four countries. It is a real instrument for development and for fighting against poverty, representing 5-10% of GDP, 30% of our total exports in value and over 60% of our farm exports. Ten million people live from cotton production. Such is the place held by cotton in our economies and its importance as far as injecting revenue into rural zones is concerned", K.D. Ouedraogo, Ambassador for Burkina Faso with the Union, declared. If African countries have begun this diplomatic approach at the WTO it is to put an end to a paradox: African cotton, although one of the most competitive, is making losses. "Farmers cannot have a place on the world market for their cotton as world prices are below the cost of production in African countries. The cost of producing one pound of cotton in the United States is 50% higher than the cost of production in Africa. If we were to go back to market forces alone, American cotton would be unable to compete with African cotton which has an undeniable comparative advantage. Such unbearable competition distortions for our countries must cease. We call on the WTO to find a system for reducing internal subsidies or export subsidies, with a view to total dismantling to allow the African countries to save their exports at 95%", he explained. In 2001 and 2002, 73% of world cotton production was subsidised, up to $6 billion. Out of this total, the share of European Union subsidies to its Spanish and Greek producers ($700 million) is moderate, but nonetheless harmful and in contradiction with EU development policy, the ambassador stressed, as Spanish producers receive subsidies equivalent to 180% of the cost of the market, and Greek producers 160% (compared to 60% for American producers).
Ambassador for Benin Euloge Hinvi went on to say that "American cotton growers receive three times more subsidies than the total USAID budget for the 500 million inhabitants of Africa. What is given to us in one hand in development aid, is taken away by the other hand by creating market conditions that prevent us from developing, which makes us sink deeper into poverty".
Ndjogou Fall, President of the network of farm organisations in West Africa, specified that the case of cotton is a prime example of a strategy that annihilates the positive results of development aid, but it is not an isolated case. He said "the same is true for rice, cocoa and peanuts".
Currently in Brussels, Benin President Mathieu Kérékou will come in person to defend the sectoral initiative for African cotton with European Commission President Romano Prodi, on Tuesday this week. He will also defend his case before the European Parliament's Committee on Development, on Wednesday.