Brazil Wins Billion-Dollar WTO Cotton Dispute with US

Cotton in Bahia state, Brazil The United States has lost its final appeal in a billion dollar trade dispute with Brazil over subsidies to US cotton growers. A World Trade Organization (WTO) appeal panel upheld a ruling from December that found the US had breached trade rules over its subsidies to cotton farmers.

The ruling means that Brazil could now seek one billion dollars in sanctions until the US stops payments to its farmers. Developing nations, especially in Africa, say the US subsidies lower global prices, squeezing their own poor farmers out of the market.

The US government is estimated to have paid cotton farmers 2 to 4 billion in subsidies in most recent years. However the compliance of the ruling is in doubt since last month the US Congress overturned a veto by President Bush and approved a US$ 290 billion farm bill that maintains many of the cotton payments for the next five years.

US cotton subsidies have become one of the most contentious issues in the WTO Doha round of talks, which seek to open up world trade.

Brazil filed the complaint with the WTO in 2002, alleging that by subsidizing farmers the US had distorted the price of cotton and made it harder for developing nations such as Brazil to compete.

The panel said the US "acts inconsistently with its obligations" as its subsidies for cotton producers are a "significant price suppression" that constitutes "serious prejudice" to Brazil.

The ruling is the first successful challenge to a rich nation's domestic farm policies and agriculture subsidies.

However, US trade officials said they were disappointed with the WTO panel's ruling and rejected Brazil's complaint that the payments distort the global cotton market.

"We believe that the changes made by the United States brought the challenged payments and guarantees into full compliance with the WTO recommendations and rulings in the original cotton dispute," said Sean Spicer, spokesman for the US trade representative.

"There is no basis to say that US payments are today having any impact on cotton prices."

The ruling allows Brazil to seek WTO approval for more than US$ 1 billion a year in sanctions on imports of goods and services from the US. WTO suggested that it could retaliate by suspending US intellectual property rights.

Mercopress

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  • Show Comments (10)

  • ch.c.

    “Wet em’ down boys and don’t you go smoking that hemp er’ we’ll n’er reach the land of them sirens! ”
    While waiting to reach the land, they may drink the several barrels of ethanol they have embarked !!!!

  • Simpleton

    His Royalness Unbounded
    Very very Quality guy that forrest, ne’? I didn’t know that the used ones ended up on barges.

    Wet em’ down boys and don’t you go smoking that hemp er’ we’ll n’er reach the land of them sirens!

  • João da Silva

    Forrest
    [quote]christofor cross sang the song sailing [/quote]

    There is another similar song by Rod Stewart. It goes like this: I am sailing home again,across the seas……

    [quote]early sails were made of heavy cotton and or hemp , and after they dried out you would see sailors pooring
    water on them to catch more air . [/quote]

    I think that you bailed Simpleton out of Ch.cÀ‚´s long tirade!!

  • FORREST ALLEN BROWN

    christofor cross sang the song sailing
    early sails were made of heavy cotton and or hemp , and after they dried out you would see sailors pooring
    water on them to catch more air .

    only the japs & chinese had silk sail and then only on royal ships and barges ,

    some raceing sails were made silk but did not hold well in a bad wind as they had a static discharge that would knock you out

  • ch.c.

    Oooops typing mistake on Brazil could seek one billion dollars
    2 years ago, when they eventually thought of doing so, Brazilians cried at how …..UNfair…. it would be !!!!

  • ch.c.

    “Quality sails used to be made of silk”
    When ?
    Had they silk sails when North America and South America were discovered ?
    May be….but I dont think so !
    Please clarify.

  • ch.c.

    “Brazil could now seek one billion dollars ”
    Sure ! Do it !
    By doing it you could rest assured that the USA will also cancel their generous favor to you….by NOT taxing $ 4 billion of your goods.
    Because they have Nooooooo obligation…to do so.
    2 years ago, when they eventually thought of doing so, Brazilians cried at how fair it would
    be !!!!
    Sure taxing imports…YOU LOVE IT ! Paying taxes on your exports…YOU HATE IT !
    You even disagree that generosity that is a nice favor and not a law or an obligation could be…….withheld.

    Welll that is at least what empty and filthy brains are certain of !!!!

    Welll let the little dogs bark, the USA caN squeeze the dogs balls…..anytime and as strong as they wish.

    Play filthy games, they will play….FAIR AND RECIPROCAL GAMES !

    😀 😉 😀 😉 😀 😉 😀 😉 😀 😉

  • Simpleton

    Cotton Pickers
    Don’t really know what part of Texas Forrest hailed from but from what sections of west Texas I saw, the cotton lands were a bit scary. Do we really need to continue the desertification of Africa and encouragement of Brazil to do much more of the same? Will the Sertao become that much more viable, productive and beneficial ecologically if the subsidies are dropped?

    …, COSTA & .., : Quality sails used to be made of silk. Famous music from the 70’s can still be heard (but the words not understood) from the beachniks in Brazil. They don’t know the name of the singer (and probably never did) so your apparent drug induced memory loss is keeping quite in concert with the castoways.

  • ..

    [quote]I will be sailing… [/quote]

    I am trying to recall that famous music of the 70À‚´s. Forget the name of the singer.

  • Where the Sky meets the Sky…
    I will be sailing…

    Costa

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