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Fair trade of cotton
- Sep 07, 2018 -

Cotton is an enormously important commodity throughout the world. However, many farmers in developing countries receive a low price for their produce, or find it difficult to compete with developed countries.

This has led to an international dispute

On 27 September 2002, Brazil requested consultations with the US regarding prohibited and actionable subsidies provided to US producers, users and/or exporters of upland cotton, as well as legislation, regulations, statutory instruments and amendments thereto providing such subsidies , grants, and any other assistance to the US producers, users and exporters of upland cotton.

On 8 September 2004, the Panel Report recommended that the United States "withdraw" export credit guarantees and payments to domestic users and exporters, and "take appropriate steps to remove the adverse effects or withdraw" the mandatory price-contingent subsidy measures.

While Brazil was fighting the US through the WTO's Dispute Settlement Mechanism against a heavily subsidized cotton industry, a group of four least-developed African countries – Benin, Burkina Faso, Chad, and Mali – also known as "Cotton-4" have been the leading protagonist for the reduction of US cotton subsidies through negotiations. The four introduced a "Sectoral Initiative in Favour of Cotton", presented by Burkina Faso's President Blaise Compaoré during the Trade Negotiations Committee on 10 June 2003.

In addition to concerns over subsidies, the cotton industries of some countries are criticized for employing child labor and damaging workers' health by exposure to pesticides used in production. The Environmental Justice Foundation has campaigned against the prevalent use of forced child and adult labor in cotton production in Uzbekistan, the world's third largest cotton exporter. The international production and trade situation has led to "fair trade" cotton clothing and footwear, joining a rapidly growing market for organic clothing, fair fashion or "ethical fashion". The fair trade system was initiated in 2005 with producers from Cameroon, Mali and Senegal.


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