Cotton-Four clarify their proposal

07 Mar '06

4 min read

World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations announces that the Cotton-Four have clarified their proposal for cutting and eventually eliminating trade-distorting domestic support in a new paper discussed in the Cotton Sub-Committee on 2 March 2006.

The new details include a formula designed to ensure that the cuts on cotton are deeper than those for agriculture as a whole, Chad, one of the four, told the committee.

A number of countries supported the direction of the proposal, which was in a document TN/AG/SCC/GEN/4, submitted the day before the meeting — meaning it was only available in French at the meeting.

Trade issues
The formula (spelt out below) is designed so that the cut in Amber Box (or AMS) subsidies for cotton are deeper than those for agriculture as a whole, an objective agreed at the Hong Kong Ministerial Conference in December 2005 (see background explanation).

The four proposing countries — Benin, Burkina Faso, Chad and Mali — have also designed the formula so that the additional cut for cotton would be greater if the general cut for agriculture is more modest.

The paper goes further, even on the Amber Box: it also calls on WTO members to agree by the end of April (when the modalities are due to be agreed) to eliminate all trade-distorting domestic supports by a date to be agreed on before the end of the Doha Round (so that the end date would be part of the “single undertaking”). That date would be after the end of the Doha Round.

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