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US must do more to reform cotton subsidies - WTO

Tue 18 Dec 2007, 15:54 GMT
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GENEVA (Reuters) - The United States is not doing enough to bring its support for cotton into line with international trading rules, the World Trade Organisation (WTO) said on Tuesday.

The published ruling by the WTO appeal body opens the way for Brazil, which brought the original case against the United States in 2002, to seek billions of dollars in sanctions against Washington.

The appeal court's findings had already been circulated confidentially in an interim report in July and then finally in October, but were made available to the public for the first time on Tuesday.

U.S. farm subsidies have become a flashpoint in the six-year old Doha round talks to open up world trade, with both rich and poor countries calling on Washington to cut its trade-distorting support for farmers.

Only on Monday, the WTO launched an investigation into U.S. farm support at the request of Brazil and Canada.

But cotton is particularly sensitive. Development campaigners say subsidies in the United States, the world's biggest cotton exporter, are depressing world prices and deepening poverty in West Africa.

While the White House has indicated that it could cut overall farm subsidies, cotton is a much more difficult issue given the political clout of cotton-producing southern states.

 
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