Cotton Subsidies Keep West African Farmers Locked in Poverty

15 noviembre 2010

Cotton: the most used natural fibre in the world should be the “white gold” that propels 10 million West African farmers out of poverty. After all, the West African nations of Benin, Burkina Faso, Chad and Mali produce the cheapest cotton in the world.

But a major new report from the Fairtrade Foundation (PDF) today reveals how the West African cotton industry is blocked by a wall of free cash doled out by the United States and European Union to their farmers.

Combined, the US and EU lavished $31.45 billion on their cotton farmers over the past nine years. These heavy subsidies dampen global cotton prices, reduce demand for West African cotton, and restrict farmers’ ability to trade their way out of poverty, which perpetuates reliance on aid.

The EU pays roughly $2.51 per pound of cotton to support its 100,000 cotton growers, which is higher than market prices for cotton. It is estimated that West African cotton producing nations lose a total of $250 million each year due to the deleterious effects of subsidies.

Three days before the European Commission’s proposals to reform the €50 billion common agricultural policy, the Fairtrade Foundation has launched the Great Stitch Up Campaign demanding the EU scraps its trade distorting cotton subsidies. The move would isolate the US, which dishes out $24.25 billion to just 3,500 farms, and put pressure on the subsidy system. One farm in the US has received $24 million in handouts over the past 14 years.

“This report reveals one of the greatest trade injustices of our time. Ten million farmers are locked into poverty while trade distorting subsidies are paid out by the EU and the US. It is incredible that EU cotton subsidies are worth more per pound than what cotton trades for on global markets,” said Harriet Lamb, executive director of the Fairtrade Foundation.

“In Mali, we’re working with one cooperative of 8,000 members who have been able to earn 50% more by producing and selling organic Fairtrade cotton. As a result, 95% of their children are enrolled in school compared with a national average of 43%. This is what a small uplift in farmers’ income can achieve. It is time to end the Great Cotton Stitch-up.”

Douda Samake, a farmer and member of the Mobiom Fairtrade cotton-growing co-operative in Southern Mali, said:

“Cotton is our only income. These (US subsidies) are the reason we’re not producing as much cotton. Mali cotton farmers are hardly able to cover their living costs. They’ve got a lot of debts and so people are walking away from cotton. That makes me really angry. If it was you, what would you think? The economy of the country suffers. Mali is hugely dependent on cotton. It obviously hurts the economy if there are less people producing cotton. It’s the main export for Mali and the state does not have funds to pay for healthcare and education.”

Read the Great Cotton Stich Up here (PDF).

You can also read a summary of major findings from the report here (PDF).

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