dc.description.abstract | Cotton has great importance to the global trade market, and could be a solution of
economic improvement in developing countries. Although, African cotton is generally
cheaper to produce, Benin, Burkina Faso, Chad, and Mali have experienced difficulties to
maintain competitiveness on the market. The reason is cotton subsidies, which are
stimulus of price settings, and therefore prejudicing for cotton production in smaller
economies. Thus, the sector has caused economic issues due to distribution of subsidies,
which has also resulted in a politic value of the crop. There are several studies that relate
the institutional theory on institution structure, legislation and decision-making processes
within the WTO, but not many are directly applied on the cotton dilemma. Still, the
cotton issue is a case study that demonstrates something greater; being a very central
issue on the WTO agenda - it is an example on WTO multinational structures, and
demonstrates how less powerful Member countries put their interests on the WTO
agenda.
The first formal complaint at the WTO on US cotton subsidies was carried out by Brazil
in 2002, asserting that the US subsidies on cotton ignored the global trade agreements.
Subsidies were declared to cause reduction in export profit and recession in price, which
made it difficult for minor producers to be competitive on the global cotton market. In the
end of April 2003, the C4 laid out a proposition on how to resolve the issues of cotton
subsidies. However, the C4 proposition failed, with no outcome. In December 2013, C4
forwarded a second proposal for cotton during the WTO Ministerial Conference in Bali. It
was grounded on developing countries progress and ability in the trade of cotton. The
meeting agreed on implementation of the so-called Bali-package, where the C4 proposal
was included. The WTO dispute mechanism purpose is to provide countries to solve
disagreements through discussion rather than war. Cotton is currently very much a part on
the WTO agenda, and the gradual change of attitude towards the cotton issue will
hopefully give the Bali-package prospects and efficiency. However, it is difficult to
evaluate legal aspects against political, and legal decision-making have to be
implemented in order to make a difference. | sv |