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TWN
Info Service on WTO and Trade Issues (Nov25/08) WTO:
Rebuffing Cotton-Four's hopes, US rejects cotton outcome for MC14 Geneva, 20 Nov (D. Ravi Kanth) -- The United States on 19 November appears to have categorically told the Cotton-Four (C-4) countries - Benin, Burkina Faso, Mali, and Chad - not to expect any decision or outcome on cotton-related issues at the upcoming World Trade Organization's 14th ministerial conference (MC14) in Cameroon in March next year, simply because the venue is in Africa, according to people familiar with the development. At an open-ended meeting on cotton, which covered both development assistance and trade-related components, the US seemingly delivered one of its sharpest statements yet against targeting MC14 outcomes based on an African venue. The US stated that the location of MC14 in Cameroon should not lead to a "venue-related outcome" regarding cotton, according to people familiar with the development. The US official, Dan Cook, also argued that it is incorrect to address cotton on a stand-alone basis, as it is part of the overall agriculture negotiations, which are stalled due to unbridgeable differences, according to people familiar with the discussions. Although trade-distorting subsidies to cotton are largely provided by the US, other members like the European Union and China are also providing substantial cotton subsidies in the form of "blue box" support, said people familiar with the development. Significantly, China, India, and the EU, among others, supported the demands raised by the C-4 countries. China and India stated that they are providing duty-free and quota-free market access to cotton, according to people familiar with the discussions. The US also informed participants that under the chairmanship of Pakistan's trade envoy, Ambassador Ali Sarfraz Hussain, the agriculture negotiations remain blocked with little to no progress toward any outcome, said people familiar with the development. However, the trade envoys of Mali and Chad, two key C-4 members, apparently pleaded with the US to act on cotton, citing the grim livelihood crisis being faced by tens of millions of their people, said people familiar with the discussions. COTTON TALKS According to farm negotiators who asked not to be identified, the US has turned its back on cotton, despite positive turnarounds facilitated by successive chairs of the Doha agriculture negotiations, particularly the former chair, Ambassador Crawford Falconer of New Zealand, in 2008. Farm negotiators stated that although the US agreed at the WTO's sixth ministerial conference in Hong Kong, China to address cotton "ambitiously, expeditiously and specifically within the agriculture negotiations", the repeated stalling on the trade-related aspects, particularly cotton subsidies, has become institutionalized. The former chair of the Doha agriculture negotiations, Ambassador Alparslan Acarsoy of Turkiye, recorded in his report to the WTO's 13th ministerial conference (MC13), held in Abu Dhabi in March 2024, that "while outcomes had been delivered on export competition, market access and transparency enhancement in relation to cotton at the 9th and 10th Ministerial Conferences held successively in 2013 and 2015 in Bali and Nairobi, Members had not been able to make progress on the central issue of trade-distorting domestic support provided to cotton producers." Despite facilitating "the negotiations on cotton as part of the overall agriculture negotiations in the context of the CoA-SS meetings, complemented by bilateral consultations with interested Members and small-group consultations in the standard cotton quadrilateral plus - "Quad Plus" - format," Ambassador Acarsoy bemoaned the lack of progress on the issue. Before MC13, the C-4 and Cote d'Ivoire had circulated a proposal for a ministerial outcome on cotton. "The proposal, which builds on past proposals by the Group, seeks to impose a limit on the sum of AMS and Blue Box cotton-specific support to ensure that it is below the de minimis threshold," the former chair noted. The C-4 proposal demanded "a numerical cap on the level of cotton-specific AMS through a tiered reduction formula and to eliminate Green Box direct payments for cotton producers," a move supported by several developing countries. The former chair noted that "it is the view of some Members that as an outcome on cotton domestic support should be part of a holistic and comprehensive outcome in agriculture, Members should engage in a progressive step-by-step process considering the remaining fault-lines, and first explore ways to enhance transparency." The view has also been expressed that it is necessary to differentiate between the various categories of support granted to cotton producers, namely AMS, Blue Box and Green Box support, considering their respective characteristics, the former chair argued. Finally, the chair's report proposed that "Members undertake to pursue and intensify negotiations on cotton trade-related measures in line with the mandate to address it ambitiously, expeditiously and specifically within the agriculture negotiations, in particular with a view to reduce substantially trade distorting domestic support for cotton in accordance with modalities that would be agreed and adopted by Members by MC14." Meanwhile, the C-4 countries have seemingly expanded their cotton agenda from subsidies to market access by raising issues concerning tariff escalation on cotton-related items. The four countries aim to become manufacturers of cotton-related final products, said farm negotiators who asked not to be quoted. OPPOSITION The US stand on cotton seems to have punctured the WTO Director-General's constant refrain that something must be done for African countries at MC14, said a trade envoy who asked not to be quoted. It is an open secret that instead of addressing key issues like cotton, which is predominantly an African concern, the DG, Ms. Ngozi Okonjo-Iweala, appears to be campaigning for outcomes on WTO reform revolving around the consensus principle, the weakening of special and differential treatment provisions, and the so-called "level playing field" issues, which are at their core an agenda of the industrialized countries, said people familiar with the development. Though none of the three reform items are part of the African agenda, the DG's apparent penchant for an industrialized-country reform agenda seems to have exposed her alleged "double standards", a trade envoy said. In fact, India's Minister of Commerce and Industry, Piyush Goyal, reportedly told the DG in Visakhapatnam, a port city in southern India, on 14 November, that the WTO reform agenda is aimed at advancing the interests of the industrialized countries while scuttling the issues raised by the developing and least-developed countries. Of late, the DG appears to be promoting the Joint Statement Initiative (JSI) on Investment Facilitation for Development (IFD), which some allege violates the WTO's procedural and systemic rules, even though it would hardly address the livelihood concerns of the C-4 or other African countries, said an African trade diplomat who asked not to be quoted. +
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