Cotton becomes 'litmus test' for Doha Development Round - Mr Lamy

03 Dec '08

6 min read

Director-General Pascal Lamy, in a speech at the UNCTAD High Level Multi Stakeholder Meeting on Cotton in Geneva on 2 December 2008, stressed that “the time has come to deliver on the promise of a fairer global trading system for cotton,” adding that this issue “affects the poorest and weakest of our members”. This is what he said:

Secretary General Speech:
As I was preparing for this meeting, I happened to read the Columbia encyclopaedia entry for cotton. It tells us that cotton has been spun, woven and dyed since prehistoric times. It clothed the people of ancient India, Egypt and China. Their use spread to the Mediterranean countries. Arab traders brought it to Italy and Spain. It travelled to England. British traders found it cheaper to import cotton from America. African countries produced it and traded it wit England. In short, cotton is a product of international trade and trade has done a lot to extend its use across the globe.

But if we are here today, it is because cotton has become a litmus test of the commitment to make the WTO Doha Round of global trade negotiations a truly development round.

I am particularly happy to be part of this discussion involving all the C4 ministers in particular, but also ministers from other cotton-producing countries that also have a stake in the outcome of the current cotton work programme.

We meet today amidst a deteriorating global economic environment that is worsening day by day and threatens to undo the economic and development gains of the past few years.

We are meeting at a time when the cotton sector globally is facing its biggest challenges in a decade.

According to the latest ICAC secretariat report, world cotton production will decline by 6 per cent in 2008-2009 to 24.7 million tonnes, the first time in five seasons that world cotton production will fall below 25 million tonnes. Add to this the expected decline in consumer purchasing power in developed economies, more stringent credit conditions and general uncertainty that will push cotton prices to even lower levels, and you begin to appreciate the magnitude of the challenge facing all of us.

Part of the solution lies in the two areas of work we have been focusing our efforts on. These are the trade policy side and the development assistance side.

On the trade policy side, the roadmap ahead of us is very clear. Developed countries, US and EC in particular, have to slash the trade-distorting subsidies they give to their cotton producers. Market access for cotton should be improved. Export subsidies for cotton must be eliminated. But this, as we all know, can only happen within the framework of the successful conclusion of the Doha Round.

In July, WTO trade ministers meeting here in Geneva failed to reach consensus on modalities in both agriculture and industry and therefore an opportunity to finalise cotton-specific commitments was missed. Many of you haveexpressed to me your disappointment that cotton was never seriously negotiated despite 10 days of ministerial engagement. I fully share your disappointment.

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