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West African Nations Urge U.S. to Drop Cotton Subsidies

Cotton 4 says changes needed to revive Doha talks.

GENEVA — Faced with collapsing prices and sharp falls in production, poor West African cotton-exporting nations have renewed their demands for the U.S. and other rich nations to scrap trade-distorting subsidies in the sector.

This story first appeared in the April 28, 2009 issue of WWD.  Subscribe Today.

The ambassador of Burkina Faso, Prosper Vokouma, speaking on behalf of the Cotton 4 nations in the troubled global Doha trade talks, said last week, “We do not want a last-minute solution imposed on us.”

Vokouma, talking on the sidelines of a cotton forum here Thursday, said the four nations are determined “to go on to the bitter end,” a clear signal to the U.S. and the European Union that there would be no final Doha deal unless the Africans’ concerns are met.

The African Cotton 4 — Burkina Faso, Benin, Mali and Chad — have presented a plan that would require the U.S. to slash its cotton subsidies by 82 percent, a demand viewed as unacceptable by the U.S. The U.S. has yet to put forward a counterproposal, even after the Cotton 4 presented five scenarios in confidential talks in November in a bid to broker a deal.

François Traore, president of the Association of African Cotton Producers, said African growers are producing around 1 million tons, a drop from around 2 million before the collapse in prices. He said cotton prices now were about $1.06 to $1.10 a kilo, sharply down from the highs of around $1.54 in the summer.

Traore said the increase in global cotton stocks to around 10 million tons due to the fall in production and exports by major textile-producing nations because of sharp declines in consumption has aggravated the situation. But he also put a lot of the blame on cotton subsidies.

“It is subsidies that create overproduction” and result in situations where supply exceeds demand. “That’s a reality,” he said.