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NCC says Falconer WTO draft text way off mark

The National Cotton Council said “nice try, but no cigar” after Crawford Falconer, chairman of the WTO Committee on Agriculture, Special Session, issued a new Doha Round draft modalities text July 17.

The Council expressed alarm at the draft modalities text, saying it includes “inequitable, cotton-specific language tabled by the C-4 countries.” The C-4 countries are four African nations that say the U.S. cotton program has harmed their producers.

“The NCC made it clear to the administration last month that if the draft modalities to be released by Chairman Falconer contained the C-4 cotton proposal, the cotton industry would have to re-evaluate its position on the Doha negotiations and on a possible extension of trade promotion authority,” the Council said in a statement.

Sen. Tom Harkin, chairman of the Senate Committee on Agriculture, Nutrition and Forestry, also issued a statement saying he thought the Falconer text called for excessive reductions in U.S. farm program payments.

In its statement, the Council noted the U.S. cotton industry has worked with the U.S. government and with the WTO to focus program delivery that met developmental goals and objectives for the West African cotton-producing countries — Benin, Burkina Faso, Chad and Mali.

“The NCC clearly demonstrated that eliminating U.S. cotton subsidies will not provide a solution for the economic plight of West African cotton producers,” the NCC statement said. “Similar evidence has been presented to the C-4, the WTO and attendees of numerous development conferences by disinterested third parties.

“Chairman Falconer appears to believe that singling out cotton will encourage developing countries to support this package. This targeting of a specific commodity should concern all Doha Round participants. The WTO's handling of cotton seems to demonstrate the organization can be taken hostage by a small, select set of interests that unfairly target a specific sector of another member's economy.”

The statement said the new agriculture text makes it clear that if a Doha Round is agreed to, U.S. agricultural policy will be written in Geneva, not in Washington. “The newly-issued text would reach deep into U.S. agricultural policy and dictate to the U.S. Congress how they must write farm programs,” it said.

The Council said it is urging the U.S. administration to strongly oppose the cotton-specific language contained in the draft and not to accept any set of modalities or any agreement that contains similar language. “Without this type of assurance, the U.S. cotton industry will undoubtedly oppose any extension of Trade Promotion Authority.”

Harkin said he applauded the efforts to move the Doha Round agricultural negotiations forward, but he believes the Falconer document may not achieve that goal.

“Although the majority of the key figures proposed by Mr. Falconer that would establish the level of reductions required in domestic support, agricultural tariffs, and export subsidies appear in the draft text as ranges, those ranges represent greater reductions in U.S. domestic support and lesser gains in market access than were envisioned in the U.S. proposal tabled in October 2005,” said Harkin.

“If a final Doha round agreement were to reflect these ranges, it would face a difficult road in being approved by the U.S. Congress.”

The Iowa Democrat said U.S. negotiators should use caution in considering changes that might be made to the various categories of programs treated under current WTO rules as non-trade-distorting or green box.

“It is essential that our government be able to maintain flexibility in these programs if we are to transition away from trade-distorting forms of domestic support as is envisioned in the Doha Round of agricultural negotiations,” he said.

“The lack of progress in the Doha Round over the last year now means that it is very unlikely that the Round will be completed before Congress finishes work on the 2007 farm bill. As chairman of the Senate Agriculture Committee, I feel obligated to try to ensure that the provisions of the farm bill are consistent with our commitments under existing WTO rules, but not with provisions of a draft text that may or may not be reflected in a final Round agreement, if one is reached at all.”

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