Cotton Dumping Devastating the Livelihood
of African Farmers
Cotton Dumping
By Oxfam International
These are anxious times for Brahima Outtara, a 25-year-old
cotton farmer in Logokourani village in western Burkina
Faso. Standing on his half-acre plot in one of the poorest
parts of one of the world's poorest countries, he surveys
his harvest and worries about the price his crop will
fetch.
That price will
decide whether or not his family has enough to eat, whether
he can pay for health costs, and whether he can keep his
three children in school. "Last year we were nearly ruined
by low world prices," he says, "we went hungry, but now
I am praying for a better future."
Cut to the high
plains of Texas. This is the cotton capital of the United
States - the country whose 25,000 cotton farmers generate
about one quarter of all world exports. Giant mechanised
irrigation sprinklers and tractors guided by global positioning
satellite systems crawl across vast farms averaging more
than 12,000 acres. Farmers here aren't losing any sleep
over prices - they are guaranteed a bumper harvest of
the crop that helps keep Outtara in poverty: farm subsidies.
The same crop is
at the centre of an increasingly bitter international
trade dispute. Eighteen months ago, the EU and the United
States promised to eliminate agricultural export subsidies
as part of the commitment to a new development round of
trade negotiations. As those negotiations move into a
higher gear, they are back-tracking on the commitment.
America's cotton farmers share almost $4bn in government
support - roughly $160,000 per head - shielding them from
the deepest depression in world prices since the 1930s.
These same subsidies deepened the current slump. By encouraging
more production for a stagnant market they lowered world
prices by a quarter, devastating the livelihoods of West
Africa's 11 million cotton farmers in the process. The
subsidy cheque delivered to US cotton producers was bigger
than the total GDP of countries like Burkina Faso and
Mali. And the world price decline cost West Africa alone
some $200m - far more than it gets in US aid and debt
relief.
The example of cotton
shows the double standards at the heart of world agricultural
trade. Subsidised US exports are destroying the livelihoods
of impoverished maize farmers in Mexico, dairy farmers
in Peru, and rice farmers in Haiti. The EU is also doing
its bit to keep the poor poor. Through the common agricultural
policy, EU taxpayers and consumers pay farmers billions
of dollars to overproduce sugar, cereals and dairy produce.
Then they pay traders to dump the surpluses overseas,
destroying the markets on which small farmers depend.
Last month, the
WTO secretariat produced a proposal for reforming agricultural
trade. Export subsidies would be slowly phased out from
2007. But over half of the $1bn a day now spent subsidising
intensive agriculture at home and export dumping would
be left untouched. Pascal Lamy has condemned it as "unhelpful
and unrealistic". This, mind you, is the same commissioner
who is pressing developing countries to rapidly open up
their markets in everything from banking and financial
services to manufactured goods.
Farm policy negotiations inhabit an Orwellian world where
words take on new meanings. Take the proposal to halve
production subsidies. This means all subsidies, right?
Wrong, in fact, it covers what are described as, in WTO-speak,
"trade distorting subsidies". Governments can provide
other types of subsidies - known in the jargon as Green
Box measures - to their heart's content, including payments
that rise with the size of a farm and past production,
compensation for low prices, and assorted income aids.
These payments may
perpetuate surplus production and export dumping, but
they are all permitted under WTO rules - and they will
be immune to any cuts agreed in the negotiations. There
are no prizes for guessing that the US wrote the rules,
or for discovering that around $2 out of every $3 spent
by the US in farm subsidies fall into the WTO-friendly
category.
Once the phoney
war has finished, the US and the EU will sink their differences
and agree a set of trade rules that allow them to continue
business as usual, regardless of the consequences for
the world's poor. Then again, they might be planning to
put the interests of people like Brahima Outtara before
the vested interests of corporate farm subsidy grabbers
in the Paris basin and the Texan cotton belt. Did anybody
else see that pig fly past my window?
Words: Kevin
Watkins.
Photos: Rhodri Jones / Oxfam
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