Brussels, 06/02/2004 (Agence Europe) - On 12 February, the Commission is expected to adopt two communications on what the EU could do to help developing countries face up to price fluctuations for basic farm products on the global market. The first communication on the trade of basic farm products, dependency and poverty should lay the foundations for an action plan. The second is the case study of a basic commodity - cotton - which causes dissension at the WTO and which the Commission has chosen to illustrate its argument.
Far from being revolutionary, these two documents will simply analyse the challenges to be raised by developing countries themselves and the international community, and list the instruments available to the EU to help attenuate the negative effect of such fluctuation, mainly in ACP countries (Africa, Caribbean, Pacific). EUROPE has reason to believe that the only concrete proposal should aim at better use of the "Flex" instrument - an instrument that replaced Stabex in the Cotonou Agreement and allows compensation to offset the consequences of price fluctuations for commodities on the budget of the States concerned, but not losses of the sector affected.
The Commission is said to have agreed to remove cotton from its general communication in response to the request made by the Council, in November, to examine the matter and then report back to it on findings. This Council requirements was itself based on a request by France calling for an initiative in favour of African cotton (see EUROPE of 20 November, p.13).