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| US moves to curb cotton subsidies |
| 2005-07-06 |
| US cotton subsidies which have fuelled a long-running trade dispute with other countries are to be scrapped, the Bush administration has revealed. The US government will ask Congress to pass legislation to repeal subsidy programmes after the World Trade Organization ruled they were illegal. The move came on the same day that Brazil threatened to raise tariffs on US imports in retaliation. Poorer countries say US subsidies distort prices and harm competition. The WTO ruled in March that US support for cotton farmers - which critics claim totalled $2.7bn between 1999 and 2003 - was unfair and gave it until June 30 to take action. Washington only partly met the deadline but now says it will end the subsidies at the centre of the dispute. Ten year credit guarantees for exporters will be terminated while financial incentives for exporters and millers to buy higher-priced US cotton will be phased out through legislation. Mike Johanns, US agriculture secretary, said the changes would put the US in a stronger position in future global trade negotiations. "By implementing these proposed changes, we are being fully responsive to the WTO decision," he said. He added that the administration would work closely with Congress to try and secure the legislation later this year. The US - the world's largest cotton exporter - has been accused of using subsidies to bolster its dominant position in the market. Up to now, it has maintained that its support for farmers falls within approved WTO levels. Earlier on Tuesday, Brazil said it would seek permission from the WTO to increase duties on some US goods, should attempts at negotiating a solution to the issue fail. "We are asking for retaliation," Paulo Mesquita, Brazil's deputy trade negotiator to the WTO, told Associated Press. "We are following all the procedural steps to preserve our rights." |
| Posted by:Steve White |
| #5 Ending subsidies is a good thing - let the market rule! Now how about the EU ending sugar subsidies? And the Frogs ending farm subsidies in general? *chirp, chirp* BTW - this is one way to help Africa; lots of cotton grown in the sub-saharan region. |
| Posted by: Spot 2005-07-06 08:44 |
| #4 ...and don't be surprised if they find a work around! |
| Posted by: Red Dog 2005-07-06 01:53 |
| #3 Not long after God created earth, King Cotton ruled supreme. In Caliphornia Cotton growers benifited mightly from their government subjects. The loyal subjects doled out subsidies to their rulers as needed.. water give aways, no interest loans, tax credits etc...The Cotton growers have always had deep pockets full of cash, not surprisingly you can still find their state & fed friends burrowed waydown deep, busily rooting. |
| Posted by: Red Dog 2005-07-06 01:51 |
| #2 Even after the stupid subsidies end, US cotton will be 1000% better than the crap that is grown in the rest of the world and will be in high demand for quality cotton wear. I sure as heck will not miss the month of spraying to knock the leaves off every year. |
| Posted by: Sock Puppet 0’ Doom 2005-07-06 01:10 |
| #1 I recommend a 'war import tax' on everything, so as not to be identified as picking on any one product or country. Tax waiverable for those actively participating in the WOT [re: Australia, UK, Poland, etc.] |
| Posted by: Clith Shaising5479 2005-07-06 00:11 |