Service on WTO and Trade Issues (Sept09/05)
Geneva, 1 Sep (Kanaga Raja) -- The World Trade Organization (WTO) on Monday had ruled that Brazil may seek authorization from the Dispute Settlement Body to suspend concessions and other obligations against the United States to an amount totalling $294.7 million annually.
ruling came in two separate reports concerning arbitration proceedings
in the US-Brazil cotton dispute. The ruling was in respect of both prohibited
subsidies and actionable subsidies provided by the
The Arbitrator determined that the annual level of appropriate countermeasures in relation to GSM 102 payments (prohibited subsidies) for Fiscal Year 2006 amounts to $147.4 million, and that the annual level of countermeasures commensurate with the degree and nature of the adverse effects determined to exist in relation to the marketing loan and counter-cyclical payments (actionable subsidies) amounts to $147.3 million.
The Arbitrator also determined that in the event that the total level of countermeasures that Brazil would be entitled to in a given year should increase to a level that would exceed a threshold (of $409.7 million in 2007), then it could be reasonably concluded that it is not practicable or effective for Brazil to suspend concessions or other obligations on trade in goods alone.
a media briefing on Monday following the release of the two reports,
Ambassador Roberto Azevedo of
Using projections for US fiscal year 2009 (1 October 2008 to 30 September 2009), he said that the total for both the fixed and variable portions (actionable and prohibited subsidies) would reach around $800 million for this year.
the threshold of $409.7 million determined by the Arbitrator in order
to apply the countermeasures under the TRIPS Agreement and GATS, the
Brazilian envoy said that according to
as a basis the $800 million estimate for the year 2009, this would mean
that for the first $460 million,
Brazilian ambassador expressed regret that the
that the present decision of the Arbitrator is definitive and that there
is no resort to the Appellate Body, Ambassador Azevedo said that
a statement issued in
we are grateful that the Arbitrators denied
to the WTO Arbitrator's ruling, Gawain Kripke, policy director for Oxfam
farm policy is broken and bloated, and now other sectors of the
"The global trading system depends on countries obeying rules and submitting to orderly dispute resolution," said Kripke.
According to the International Cotton Advisory Committee, total direct support to cotton production hovered over $3 billion in the 2008-2009 growing season, or an equivalent of 50 cents per pound of actual production.
Oxfam study has found that with a complete removal of
to Oxfam, the ruling confirms that