The Great Cotton Rip-Off

Tuesday, September 18, 2007.

By Rosemary Ekosso

"Cotton farmers in Africa do not need aid programs. They need people to play fair. Instead of ruining the farmers and then giving them handouts so that you can feel superior and convince your overfed public that that you are the saviours of those Africans who cannot manage their affairs...."

The basic problem with cotton is this: World prices have fallen, which means that cotton producing countries get less for their cotton. If people are unable to make a profit, then they do not have money to purchase the agricultural inputs necessary to ensure that their activities are efficient, worthwhile and sustainable.

But the great tragedy here is that of subsidies. Subsidies have caused the price to nosedive. Greece and Spain receive cotton subsidies from the EU. But the Great Satan of subsidies, at least in so far as cotton is concerned, is the United States.

That country subsidises its farmers so that they produce their crop at a lower cost, and then dump it on the global market, further driving down prices. But what is much worse is that cotton goods produced in the United States are then dumped on African local markets, where the more expensively produced and therefore pricier local crop is unable to compete with American cotton.

So the Africans have complained. They have written letters and done their best to make a determined stand in the WTO. But who runs the WTO? And how transparent are WTO negotiations? This book  will tell you.

There is a lot of online material on the African cotton situation. This is heartening in that it shows that there is some international awareness of the problem. But while we are becoming internationally aware, poor cotton farmers cannot buy medicine for their families or send their children to school. They die of easily treated diseases. Lives are ruined. That is why cotton shirts cost lives.

Consider the following statement made in 2005 by Peter Mandelson, EU trade commissioner:

“In Mali, and the rest of West Africa roughly 15 million people depend on cotton for their living. In the major cotton producing African states, cotton accounts for between 50 and 80 percent of exports. Collapsing cotton prices on the world market, driven down by subsidies in the developed world, are putting people at serious risk. In the face of the hardship experienced by African cotton producers the EU is committing to exceptional treatment for cotton in the WTO negotiations. ”

You are heartened, are you not?

Don’t be. The EU system website which trumpets Mr Mandelson’s statements cannot even be bothered to find out what people from Mali are called. It calls them “Malinese”. I don’t know who runs the language service in that outfit, but someone ought to be sacked.

Furthermore, we have been enjoying the fruit of European “commitment” for centuries, and we can discourse at length on just how bitter it tastes.

And when Mr. Mandelson refers to exceptional treatment for cotton in the WTO, I find it a revealing statement. The dozens of other unexceptionally treated commodities will presumably be handled as usual; that is, poor producers will be fleeced. These cotton reforms should not be exceptional. They should be general.

In addition, they have started aid and assistance packages. You know the drill: pictures of starving children, interviews of sun-baked fields, rickety huts and lots of flies, followed by some carefully scripted “background” of the problem, and the White Knight in shining armour coming with a bundle of nice-nice money, all of which serves to prove to the world the perpetual infantilism and fecklessness of Africans, who have to be saved from themselves.

But, as with much so-called aid, which on many occasions is a cool trick for employing their own people while making us contract more long-term loans and obligations, the problem it purportedly seeks to address would be solved fairly easily through fair trade.

Here’s an interesting quote:

For example, a country like Mali, for the same year, received 37 millions of dollars in aid, but lost 43 millions, due to lower export revenues as a consequence of other producer countries’ cotton subsidies.

That is Blaise Campaore, the despotic leader of Burkina Fasso, speaking to the WTO. He ought to know, one would think.

But then we have this bunch of dangerous clowns  who say this:

“The aid programs are welcomed, but they sidestep the biggest demands of the West African countries: an end to developed country cotton subsidies, duty-free and quota-free access to developed country markets and creation of a fund to compensate African cotton producers when market prices are low .”

I go further. I don’t welcome them at all. Who are these people who have welcomed these aid programs anyway?

For Africans cotton farmers to welcome the handouts would be like allowing a rich man to rob you so you can enjoy the doubtful privilege of begging for the crumbs that fall from his table.

Cotton farmers do not need aid programs. They need people to play fair. Instead of ruining the farmers and then giving them handouts so that you can feel superior and convince your overfed public that that you are the saviours of those Africans who cannot manage their affairs, you should stop cheating.

One can get quite irritated by all this until one realises that the website where this “analysis” is published is maintained for the purpose of representing those subsidised US farmers whose determination to hang on to their subsidies is, at least in part, the root of the problem.

What is it with cotton farmers in the US? First they needed slaves to pick the cotton. Now they need government money to actually grow the thing.

Anyway, the World Bank estimates that if the subsidies were removed, global cotton prices would rise 12.9%. And African cotton exports would rise by 17%. That would be a nice start.

In the meantime, the struggle continues. Oxfam America has a nice little story of Mozambican farmers trying to get organised . It’s not much, but it’s something.

This month’s edition of Le Monde Diplomatique carries a story about the most unorthodox privatisation of the French textile behemoth, Dagris , which was sold for something like one eighth of its actual market value. It is worth reading.

According to this story, President Abdoulaye Wade of Senegal was one of the Africans who wanted to buy Dagris so that Africans could at least have some control over their fate. But do you see the “lecturer” Mr. Sarkozy letting a bunch of Africans get their grubby hands on such an important instrument of French policy?

To return to the Great Cotton Satan, the article mentions that the United States pays out 4.8 billion dollars in subsidies to some 25,000 producers, which is three times its entire official development assistance to Africa.

You do see where people’s priorities lie, don’t you?

Rosemary Ekosso is with the International Court of Justice, the Hague, Netherlands. She blogs at Ekosso.com