July 1, 2005

Cotton subsidies ruining African farmers, says minister

Mozambique's Minister of Industry and Trade, Antonio Fernando, has denounced the subsidies given by developed countries to their own cotton farmers, as ruinous to the livelihoods of African peasants. Fernando stressed that especially cotton was a crop that poor peasant families should be able to use to improve their living standards. But the efforts made by Africans who depend on cotton "have purely and simply been annulled by the subsidies granted by industrialised countries in favour of their own producers", he accused. "As a result cotton prices on the world market do not reflect the costs of production", he said. Furthermore the difficulty in placing African products in northern markets "hits at the income of our farmers, who are working under much more difficult conditions than producers in the developed countries". Fernando insisted that scrapping the export subsidies and the domestic support enjoyed by producers in the northern countries "is a priority and urgent action", which should be accompanied by measures of domestic support for producers in developing countries so as to increase their competitiveness. For the Minister, solving this problem depended on the political will of Mozambique's "development partners". "Isn't partnership supposed to be something in which everybody wins?", asked Fernando. It was also difficult to understand, he added, why poor countries had to export raw cotton to rich countries, and then import from those same countries shirts, trousers, linen and other finished items made of cotton. He argued that poor countries should work together in transforming raw materials such as cotton into finished goods, in order to enjoy economies of scale.
According to a documentation, the world market price of cotton has slumped by 54 per cent since the mid-1990s, posing a serious threat to three million cotton producers in southern Africa. Prices are depressed essentially because farmers in the developed world are subsidised by their governments to dump ever larger amounts of cotton on the international market. This reduces the foreign exchange earnings that African countries might otherwise expect from their cotton, and perpetuates rural poverty in cotton growing areas. (Agencia de Informacao de Mocambique, Maputo)

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