WASHINGTON: In a stunning role reversal, two African presidents demanded Friday that the United States apply its free trade preachings to its own economy by lifting generous state subsidies paid to southern cotton farmers.
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"This vital economic sector in our countries is seriously threatened by agricultural subsidies granted by rich countries to their cotton producers," President Amadou Toumani Toure of Mali (left) and Blaise Compaore (right) of Burkina Faso wrote ["Your Farm Subsidies Are Strangling Us"] in The New York Times.
"Our demand is simple," they continued, "apply free trade rules not only to those products that are of interest to the rich and powerful, but also to those products where poor countries have a proven comparative advantage."
According to the African leaders, cotton accounted for up to 40 per cent of export revenues and 10 per cent of gross domestic product of Mali, Burkina Faso, Benin and Chad -- and constituted what they called their "ticket into the world market."
They insisted it was 50 per cent cheaper to produce cotton in Africa than in developed nations. But the industry's competitiveness was being undercut by about three billion dollars in annual assistance paid in the United States to 25,000 cotton farmers to enhance their competitive edge, the presidents said.
"Such subsidies lead to worldwide overproduction and distort cotton prices, depriving poor African countries of their only comparative advantage in international trade," complained Toure and Compaore, adding that the payments lead to the impoverishment of about 10 million rural poor people in west and central Africa.
The presidents said their countries will demand an end to subsidies paid to cotton farmers in developed countries at a World Trade Organisation ministerial meeting set to take place in the Mexican resort city of Cancun in September.
"As an interim measure, we have also proposed that least-developed countries be granted financial compensation for lost export revenues that are due to those subsidies," the leaders said.
The shot across the US bow came as Bush toured Africa, urging regional leaders to adhere to free trade and open their markets to US products, particularly genetically modified crops currently banned in many countries.
There was no immediate reaction to the appeal from either US government or business representatives. But the African leaders were taking on entrenched business and political interests, and the influential US cotton lobby has repeatedly made it clear it would fight attempt to repeal the subsidies tooth and nail.
Appearing before Congress last month, National Cotton Council Chairman Bobby Greene, a cotton gin operator from Alabama, said the notion that US policies drive world agricultural trade was "simply ludicrous" and "based on seriously flawed economics."
"It is misleading the leaders of many African countries," he stated. "It ignores the substantial trade preferences the United States provides to African countries to enable them to develop their textile and apparel processing industries."
Greene complained that imports in eight cotton-containing textile categories surged 641 per cent last year, seriously endangering many US producers. Hundreds of textile factories shut their doors causing the industry to lose 267,000 jobs just between January 2001 and May 2003, according to the council, which is demanding protective action. On Thursday, US Trade Representative Robert Zoellick expressed general skepticism about the WTO meeting in Cancun, saying it was "more likely to highlight differences than agreements."
source: http://www.jang.com.pk/thenews/jul2003-daily/12-07-2003/business/b20.htm 17sep03
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