America's $24bn subsidy damages developing world cotton farmers

The developing world can't compete with the US's giant $24bn subsidy for its cotton farmers. Barack Obama should end the payouts

A man works in a cotton factoryc in Mumbai
A man working in a cotton factory in Mumbai, India. US subsidies of $24bn to its cotton farmers have driven down world prices and damaged livelihoods of developing world cotton producers. Photograph: Danish Siddiqui/Reuters

I've been looking forward to President Barack Obama's state visit to the UK this week and to hearing him address MPs and peers at Westminster Hall.

President Obama will no doubt focus on many matters of great international importance. I think cotton should be one of them. I have seen for myself just how vital cotton is for millions of farmers in west Africa and the damage caused to their livelihoods by developed country subsidies. I have pressed for EU reform, but action from the United States is critical.

President Obama could, and should, take a lead in addressing this.

The US government continues to subsidise its cotton farmers – $24bn (£15bn) over the past 10 years – despite the World Trade Organisation ruling some of these subsidies illegal. And when the WTO backed Brazil's case that the subsidies were damaging, the US government simply offered to pay subsidies to Brazilian farmers too.

I can't be alone in spotting the irony of the world's greatest free-trader continuing to violate the system so blatantly.

America's payments to its farmers are designed to shield them from the volatility of cotton prices. But they also enable the US to export cheaply, depressing the price for other cotton producers in some of the poorest regions of the world and leaving them unable to compete with their richer American counterparts.

The voices of African farmers and others in developing countries are being ignored. In 2008, a group of African leaders tabled specific proposals to which the US has so far failed to respond.

It is now nearly 10 years since the WTO Doha Round talks first began. In 2001 there was a clear objective – to lower trade barriers around the world and help facilitate the increase of global trade. But the promise to make the Round deliver for development has clearly failed and the talks are now on the brink of collapse.

The world needs to focus on rebuilding faith in the multilateral trading system and also respond to the concerns raised time and time again by governments across Africa. An immediate commitment by the US to implement the WTO's ruling and to cut cotton subsidies further would be a good place to start.

Taking this action would send a clear message to farmers in developing countries that the world is serious about its commitment to trade reform.

Discussions around the latest US farm bill have just begun. Now is the ideal time to raise this matter and bring about real change for millions of farmers who depend on cotton for a living. The coalition government has promised to do more to address the impact of European subsidies and must honour this, but action from the US is vital. The president's state visit provides a unique opportunity for the government to raise the profile of this important issue.

The United States and others made a commitment in Doha to farmers from developing countries. But, almost a decade later, there has been no change. Whether Doha fails or succeeds, President Obama can and should, take a lead on removing illegal cotton subsidies and ensure that the promises made are honoured.

Baroness Kinnock of Holyhead is the opposition's spokeswoman on international development in the House of Lords and an expert on trade and development. She was minister for Africa in Gordon Brown's government

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