US: Cotton subsidies come to an end under WTO deal
Major subsidies to the US cotton export industry came to an end on Tuesday (1 August), fulfilling a promise made at World Trade Organisation talks in December.
Support for US cotton growers was abolished in a new trade act signed by President George W Bush in February repealing the so-called Step 2 programme.
It means that US exporters and manufacturers will no longer receive an incentive for buying higher-priced cotton from domestic farmers.
Brazil brought the case to the WTO, saying government help for American cotton farmers distorted the global market and gave US exporters an unfair advantage.
The system has been particularly damaging to cotton-producing nations in West Africa, whose exports were hampered by depressed world prices.
Brazil is still considering the imposition of US$4bn in retaliatory duties on the United States.
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