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WTO Renews Trade Talks

GENEVA — World Trade Organization talks on the role of cotton subsidies and their impact on poor African nations got back on track Tuesday after the U.S. backed down from a demand that the negotiations be broadened to include other textile...

GENEVA — World Trade Organization talks on the role of cotton subsidies and their impact on poor African nations got back on track Tuesday after the U.S. backed down from a demand that the negotiations be broadened to include other textile issues.

Early this month, the WTO ruled that the U.S.’s Step 2 cotton program, which included $2 billion in annual payments, was in violation of global trade rules that regulate how governments use domestic and export subsidies. The African countries are pushing to abolish the use of all cotton subsidies by all nations.

The negotiations had been in a holding pattern since last month, when the U.S. asked that the agenda be revised to include other aspects of textile trade. That request provoked ire among some African negotiators, who want the issue of cotton subsidies to get prompt attention. Many African nations contend that subsidies paid by the U.S. and European Union to their cotton farmers make it difficult for Africa to compete in one of the few sectors where it has natural advantages, including large amounts of arable land and low wages.

Anger over the issue had led a group of poor nations to walk out of the Cancún trade talks in September 2003, bringing that summit to a premature end. Following that meltdown, the WTO in July agreed to address the subsidy issue “ambitiously, expeditiously and specifically.”

People familiar with the situation said the panel’s new agenda, due to be released this week, will focus solely on the subsidy issue.

Samuel Amehou, Benin’s ambassador to the WTO, said in a phone interview, “What is sure is that the U.S. and the EU have to solve this subsidies issue. If it’s not, we face a traumatic situation in West Africa on cotton.”

The U.S. delegation did not take the floor to directly address the change, according to sources.

Separately, Benin — backed by Burkina Faso, Kenya and Senegal — blasted comments by the EU delegation that the 25-nation bloc did not plan to contribute to a proposed transitional cotton fund, which is intended to help the West African nations handle the effects of the subsidies as long as they remain in place.