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Afrique: Cotton: Africa Calls for End to Subsidies

Fred Vubem

23 Juin 2006

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Heads of State condemn subsidies to farmers in developed nations.

In the run-up to the recent World Trade Organization (WTO) ministerial conference, Burkina Faso, Mali, Chad and Benin spearheaded an initiative to eliminate cotton subsidies worldwide. President Compaore of Burkina Faso spoke to the Trade Negotiating Committee of the WTO in June. With President Toure of Mali, he co-authored a letter to the New York Times condemning the subsidies.

The facts are startling. US cotton farmers receive subsidies worth $3.7 billion (about CFA 1,961 billion)a year, Chinese cotton farmers $1.2 billion, (about CFA 636 billion) and European cotton farmers $700 million. These subsidies have been devastating to the cotton sector in the West and Central African countries. Falling cotton prices have meant falling incomes for Burkinabe farmers. In neighbouring Chad, whereas ten years ago farmers could afford to pay for goods and services with revenue from cotton sales, they now have to buy on credit against next year's harvest. Farmers are locked into a cycle of poverty as each successive crop fails to generate enough to pay off debts and cover needs.

The primary problem faced by African cotton producers, is not one of low crop yields due to insect attack but the absence of an equitable price for the cotton they produce. Despite a 14 per cent increase in cotton yields, export receipts of countries in West and Central Africa have fallen by 31 per cent in recent times. Producers now earn only 60 per cent of their costs, although they can produce a kilogram of cotton at half the cost of their competitors in the developed world. Estimates by the International Cotton Advisory Committee indicate that the withdrawal of US subsidies would raise world cotton prices by 26 per cent.

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