07-05-2005, 01:40 PM
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El Destructor II
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Join Date: Jan 2003
Location: 11th& Sansom
Posts: 23,281
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Cotton, Live 8, Subsidies
more fo a coincidence than a connection to Live 8, repealing US cotton subsidies woudl be a huge boon for many poor contries in both africa and latin america.
Quote:
U.S. Is Proposing Repeal
Of Federal Cotton Subsidy
Associated Press
July 5, 2005 11:33 a.m.
WASHINGTON -- The Bush administration is proposing to repeal a federal cotton subsidy in an effort to comply with a World Trade Organization ruling against the program.
The Agriculture Department announced Tuesday it is sending legislation to Congress to eliminate the government's cotton-marketing program, called Step-2, which makes payments to exporters and domestic mill users to compensate them for buying higher-priced U.S. cotton.
Altering the government's cotton subsidies is essential for the U.S. to lead global trade negotiations aimed at slashing subsidies, tariffs and other barriers to trade, Agriculture Secretary Mike Johanns said. Those talks "are crucial to U.S. market access and the long-term prosperity of our farmers and ranchers," Mr. Johanns said.
The proposal is the government's second step toward following the WTO ruling, which cited two types of subsidies -- government export programs and cotton-marketing programs -- as higher than allowed under WTO rules. The administration changed the export programs on Friday, the deadline set by the WTO for illegal export subsidies and domestic payments to end
Congress created the Step-2 cotton program, and lawmakers have indicated they will try to deal with the issue during the congressional budgeting process this year.
The administration proposes eliminating Step-2, removing a 1% cap on fees that can be charged under export credit programs and ending one of three export programs, the Intermediate Export Guarantee Program, called GSM-103. Export credit guarantees help U.S. growers sell commodities by making financing available to foreign customers.
Brazil brought the complaint to the WTO, arguing that the U.S. has maintained its dominance as the world's top cotton exporter, and second-biggest cotton producer, through subsidies to cotton growers averaging more than $2.7 billion annually from 1999 to 2003.
Brazil said Tuesday it was asking the WTO for permission to penalize the U.S. for its failure to comply with WTO requirements.
"We are asking for retaliation," said Paulo Mesquita, Brazil's deputy trade negotiator to the WTO. "We are following all the procedural steps to preserve our rights." He said Brazil was still in consultation with Washington, but filed its request so it can impose tariffs on U.S. imports if negotiations fail.
Copyright © 2005 Associated Press
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http://online.wsj.com/article/0,,SB1...%5Fstory%5Flsc
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