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17 January  2018 
(18-0446) Page: 1/6 
 Sub-Committee on Cotton    
 
 IMPLEMENTATION OF TH E DEVELOPMENT ASSIST ANCE ASPECTS OF THE  
COTTON -RELATED DECISIONS IN  THE 2004 JULY PACKAG E AND  
PARAGRAPH 12 OF THE HONG KONG MINISTERIA L DECLARATION  
ITEM 2C - COHERENCE BETWEEN TR ADE AND DEVELOPMENT ASPECTS:  
UPDATE ON THE DEVELO PMENT ASPECTS OF COTTON  
Report of the 2 7th Round of the Director -General's  
Consultative Framework Mechanism on Cotton1 
24 July  2017 
 
 
 
1  INTRODUCTION  
1.1  The 2 7th Round of the Director -General's Consultative Framework Mechanism on Cotton 
(DGCFMC) took place on 2 4 July 2017 , under the chairmanship of Deputy Director -General 
David  Shark .  
STATEMENT BY THE C4 COORDINATOR  
1.2  The Ambassador of Mali, speaking on behalf of the C4 countries expressed  concern on the 
slow progress on the work related to Domestic Support in Agricu lture which the Group considers to 
be at the crux of the stalemate in the negotiations .   
1.3  She recalled the decisions made at the C4 Coordination Meeting held in Cotonou, Benin from 
18-21 April 2017, which called for a follow -up on the effective implementat ion of all Ministerial 
Decisions taken in favour of  cotton . She added that those d ecisions included a call for substantial 
reductions and eve ntual elimination of  all forms of  support which had  trade -distorting effects on 
cotton and it s derivatives. S he men tioned that the C4 would  undertake consultations with other 
Members in order to submit a draft Ministerial Decision for consideration at the Eleventh WTO 
Ministerial Conference ( MC11 ) which would be  in line with the Hong Kong mandate of 2005, calling  
for ambitious, rapid an d specific treatment for  cotton.  
1.4  She reaffirmed the C4's commitment to the multilateral trading system (MTS) and the merits 
of this system to enable  its greater integration  into the global economy . She maintained that trade 
was important  in order to fight against under -development and to create inclusive developme nt in 
their countries. The C4 wa s delighted with the initiatives and encouraged other Members to work 
towards achieving a negotiated solution for cotton , in particular African cot ton producers .  
1.5  She welcomed the new Executive Director of  the International Cotton Advisory Committee  
(ICAC), Mr. Kai Hughes, who took up his position on 1 September 2017 and assured him of the 
C4's commitment to support ICAC's work under his stewardship.  She acknowledged the 
contributions made by Members to facilitate the updating of their database. She thanked China for  
its financial support which  made it possible for the Focal Points from the capitals to participate in 
the meeting.  She thanked Mr. Gerar do Melogno, who retired in August 2017, for his services 
especially in support of C4 work on development  assistance  aspects on cotton and wished him 
great success in his future endeavours.  
                                                
1 This document has been prepared under the Secretariat's own responsibility and is without prejudice 
to the positions of Members or to their rights and obligations under the WTO.  TN/AG/SCC/W/2 7 • WT/CFMC/5 5 
 
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  1.6  The Chairman of COS -Cotton , Ambassador Sékou Cissé (Mali) speaking on behalf of the ACP 
Group, stressed on the important role played by cotton production in the development of the 
African continent. He highlighted the benefits of the European Union -Africa Partner ship on Cotton 
whose objective wa s to contribute to the figh t against poverty in cotton areas by improving the 
competitiveness, added value and viability of the African cotton sector. He mentioned that under 
this Partnership programme more than 200 specific support actions for African cotton projects 
costed at abou t €650 million have been identified , and 70% of the funding would  be provided by 
the EU to realize them.    
1.7  He added that in order to ensure sustainable and inclusive development of the cotton sector in 
Africa and to benefit from the experienc e, a three -pronged approach required to  be adopted: 
(i) accelerate the creation of added value in African cotton -textile and clothing value chains;  
(ii) improve the use o f the production area available; and (iii) create a strategic policy framework 
for the sustainable, inclusive and ambitious development of cotton/textile and clothing value 
chains.  
1.8  The representative  of Pakistan , stated that cotton wa s a major crop of Pakistan after wheat 
and occupies the largest area in the country compared to other crops. Production o f cotton and 
cotton -related products account ed for 10% of GDP and 55% of the country's total foreign 
exchange earnings. The area under cultivation of cotton increased significantly in the last 30 years 
to around 7.86 million acres in 2015/16. He also added  that his Government was in the process of  
undertaking a number of reforms in its cotton sector.  
1.9  The representative of the European Union  reiterated its support for the African cotton sector . 
The EU provided a new type of support which e ncouraged  investmen ts through its external 
Investment Fund for job creation. It also welcomed the opportunity to learn ho w African countries 
would  mobiliz e investments, facilitate private sector investments in commodities such as cotton 
and ensure that public -private sector dialogue wa s able to contribute to an effective investment 
strategy into these value chains.   
COTTON PRODUCTION AND TRADE TRENDS  
1.10  The outgoing Executive Director of the ICAC, Mr. Terry Townsend , welcom ed the incoming  
Executive Director of ICAC, Mr . Kai Hugh es, who will be assuming his new role on 
1 September  2017. Mr. Townsend also paid tribute to the former  Executive Director , 
Mr. José Sette and he  welcome d Bangladesh and the EU as  new members of ICAC . 
1.11  He explained that the biggest challe nge facing the cott on industry wa s the growth in 
polyester production.  In the last 17 years, global polyester production grew from 9 million tonnes 
to ap proximately 50 million tonnes. T he production in China alone ( the largest producer ) during 
the same period of time increa sed from 1 million tonnes to 35 million tonnes. He acknowledged 
that the changes in industrial policies have contributed to loss of global market share for cotton. 
He added that the seco nd challenge being encountered wa s the negative campaigns by 
environme ntalists and other groups, especially through misguided reports , which had been  
affecting consumer perception and began  to seep into the perception of governments and 
government regulators.   
1.12  He also stated that for cotton to remain relevant in the modern market era, it had  to 
transform itself with a view to competing  with modern fibres. He added that currently, the natural 
fibres account ed for a fraction of what it did during  the 1800s. He also mentioned that it in the 
1960s , cotton accounted for 70% of al l fibres used around t he world and currently it stood  at 
about 30%.  
1.13  He highlighted the shifts in world mill use using ICAC data from the 1930s where 
North  America and Europe's share of mill use fell from 24% and 28% to 5% and 1% , respectively 
and Africa's global share in mill use has remained  constant  at 1% in the last 70 years.  
1.14  He underscored Africa's potential to increase cotton production and mill use. The main 
drivers for the projected increase stem med from population growth and greater income growth, 
providing opportunities for increased cotton transformation. The other contributing factors include d TN/AG/SCC/W/2 7 • WT/CFMC/5 5 
 
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  investment friendly policies, trade preferences in the large markets and improved access to 
capital.  
1.15  In respect to the forecast for the next 10 years, he hi ghlighted that India and the 
South  Asian region would  replace China as the largest produce r of cotton because production wa s 
shifting towards manmade fibres. South Asia was also expected to be the largest region for  cotton 
mill use. East Asia would  remain the same at the current levels. There was expected to  be some 
growth in North  America as brand retailers put more emphasis on local sourcing.  
1.16  Responding to some queries from the delegations in respect of increasing production , the 
challenge posed by polyes ter and the negative campaigns being carried out against cotton 
producers . The outgoing  Executive Director of the ICAC explained that production of cotton in 
Africa was being negatively affected by factors such as soil types, rainfall, temperature varietie s 
and lack of input finance. Secondly, he explaine d that polyester production would continue as it 
had tactical advantages over cotton in industrial use as it wa s more suited to a number of 
applications. Thirdly, he mentioned that the parties involved in t he nega tive campaigns against 
cotton, we re mostly from advocates of organic cotton production. He added that organic cotton 
production wa s very labour intensive using inefficient  old fashioned technology that wa s not 
economically  viable in today's economy and wa s suited to small holders.   
DIRECTOR -GENERAL'S EVOLVING TABLE ON COTTON DEVELOPMENT ASSISTANCE  
1.17  The Chairman , in introducing item 4 of the agenda , made reference to the 23rd version of the 
Evolving Table (ET), circulated as document WT/CFMC/6/Rev.22 . He invited Mr.  Gerardo Melogno  
(Development Division ) to highlight the main points of this updated version.  
1.18  Mr. Melogno  informed  the participants that th e data contained previously in P art III of the 
table has been made available through the web links show n in the first page of  the ET. He reported 
that the latest version was prepared on the basis of contributions from several Members namely; 
Brazil, Canada, EU, Japan and Switzerland. In addition, contributions were also received from ITC 
and UNCTAD.  
1.19  He noted that in part I of the ET concerning the ongoing activities of cotton specific 
development assistance, the number of beneficiaries remained stable at 30, while the number of 
commitments had decreased to 27. The total value of commitments had decreased fro m 
US$280  million to US$203 million, while the total value of disbursements had increased from 
US$99 million to US$110  million. He add ed that the ratio of total disburseme nts to total 
commitments increased from 36% to 54%. The increase was due mainly to pro jects which were 
considered to be completed and therefore moved to the Annex  of the ET . 
1.20  With respect to part II of the ET relating to ongoing act ivities under the framework of 
agriculture and infrastructure -related assistance, he informed that the number o f beneficiaries 
remained the same at 31, and the number of commitments decreased from 67 to 61. The value of 
commitments had decreased from US$4.11 billion to US$3.94 billion in the revised version. The 
total value of disbursements had decrease d by US$140 million and currently stood  at 
US$1.74 billion. The ratio of the total disbursements to the total commitments had decreased 
slightly to 44% from 46% previously.  
1.21  He said that Annex I contained  the completed activities under cotton specific development 
assistance, the total n umber of activities completed had been  192, covering a total of 
47 beneficiaries. The total value of these completed activities in terms of commitments increased 
from US$580 million to US$659 million , whereas the actual disbursements reac hed 
US$505  million . With respect to the completed activities under the framework of agriculture and 
infrastructure -related development  assistance contained in Annex II , the total number of 
completed activities reached 117 covering a total of 29 beneficiari es. The total value of 
commitments of these completed activities increased from US$4.29 billion to US$4.50 billion, while 
total disbursements reached US$4.43 billion.  
1.22  He thanked  the donor community for  providing  the latest updates . He also pointed out , that 
despite the fact that disbursement status  reports have increased, there is still room for TN/AG/SCC/W/2 7 • WT/CFMC/5 5 
 
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  improvement , in particular regarding some long standing activities, for which fresh updates are 
needed. He also encouraged the members to submit information on part ial disbursements.  
1.23  With regard  to the notification of National Cotton Sector Focal Points, he informed  the 
meeting that the number  remained at 16. He encouraged other remaining African cotton producing 
countries to communicate to the Secretariat the names and coordinates of their National Focal 
Points in order to complete the list.  
1.24  The representative  of Mali  on behalf of the C4 , thanked the donor s for their support,  and 
encouraged them to continue providing such support to improve the competitiveness of the  African 
cotton producers. In addition, she hoped th at the development partners would  continue to mobilize 
funding for programmes related to the improvement of valu e chains in the cotton sector.  
1.25  The representative  of Japan  intervened to share their initia tives on development , especially 
in Africa. She reported that eleven  new projects were added in part II of the ET. A further three  
projects  under the grant aid scheme had also been taken  to provide funding for economic and 
social development proj ects under taken by Japanese NGOs. She further reaffirmed  Japan's 
continue d support to Africa through public -private partnership.  
SOUTH -SOUTH COTTON COOPERATION  
1.26  The representative  of Brazil  provided an update on the financial disbursements in the 
framework of the bil ateral projects with some African cot ton producing countries. He reported that 
Brazil  provided  additional  information relating to cooper ation with international organiz ations i n 
projects in Africa as well as in South America . The Brazilian Cooperation Agen cy had  also started 
work on two new projects in Benin and Mali . He reaffirmed his country's commitment in providing  
technical assistance to cotton producing countries as a tool to promote  their economic and social 
development.  
1.27  The representative  of China  shared his  country's latest efforts in South -South Coopera tion o n 
cotton. He informed that his Government was planning  to hold several t raining courses on cotton 
under its  South -South Cooperation programmes which would  focus on cotton production and 
spinni ng technology in developing -country Members, particularly in LDCs. I n the  area of  bilateral 
technical cooperation, a number of agricul tural demonstration centres had  been established in 
some African countries. He also reaffirmed Ch ina's commitment to conti nue providing agricultural  
inputs to support  cotton production  in African countries.  
1.28  The representative of Pakistan  reported that it  had arranged a training programme in 
Pakistan for C4 countries , which wa s aimed at sharing the best practices on cotton pro duction and 
trade.  
1.29  The representative  of Benin , speaking on behalf of the C4 , expressed deep gratitude to all 
the partners for the continued support provided to African cotton producing countries. He thanked 
particularly China, Brazil and other South -South  cooperating partners for their support to African 
cotton producing countries , particularly the C4.  
1.30  The Chairman  thanked all those who  provided updates , and underlined that such  updates 
enhance d the implementat ion as well as reinforced  South -South cooperat ion. He also encouraged 
developing countri es to continue to strengthen  South -South cooperation on cotton.  
DOMESTIC COTTON SECTOR AND OTHER REFORMS/NATIONAL COTTON SECTOR FOCAL 
POINTS  
1.31  The Chairman  invited comments on the latest version of the Ev olving Table  circulated to 
Members  in WTO document – WT/CFMC/21/Rev. 13. He menti oned that updates were received 
from Burkina Faso, which came l ate for the Secretariat to include in  the new version of the tab le 
and would  be includ ed in the next revision of the T able. 
1.32  The representative of Burkina Faso  inform ed th at its domestic cotton sector had  undergone 
considerable reform  and law has been enacted to allow investors to produce their own electricity to 
overcome the energy constraints faced by the sector . In terms of pr oduction figures, h e stated TN/AG/SCC/W/2 7 • WT/CFMC/5 5 
 
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  that 685,000 tonnes of cotton was produced in 2016/2017 compared to 550,000  tonnes in 
2015/2016 and it had been projected that the country would  produce 800,000 tonnes in 
2017/2018. He added that the price of cotton in 2016/2017  stabiliz ed at CFA francs 235 per kg  
and the price of first grade cotton seeds stood at CFA francs 10 per kg.   
1.33  The representative of Benin stated that the Government undertook significant reform s of the 
cotton sector in 2016 , and they had  already begun  to yield satisfactory results.  He added that the 
most significant reform undertaken was related to the establishment of a framework agreement 
for the partnership between t he Government of Benin and the I nter-Professional Association for 
Cotton which was suspe nded in 2012.  As of June 2016 , government assistance related to the 
provision  of agricultural  inputs to cotton producers was  ceased. He i nformed the meeting that 
Benin wa s projected to produce 550,000 tonnes in 2017/2018.   
1.34  The representative of Chad inform ed th e meeting that in 2016/17 as part of the reforms 
aimed at reviving the cotton sector, a decision was taken by the Government to gradually increase 
cotton seed production  to 220 ,000 tonnes by the end of 2017 , and a production target of 
300,000  tonnes h ad been set for 2017/18. In addition, the Government sought  to ensure that the  
domestic  producers obtain ed fibres at prices similar to the international price levels. He mentioned 
that cotton seed price reduced from  CFA franc 240 per kg in 2013/ 14 to CF A franc 220 per kg in 
2016/17. Early this year, a  decision was taken  to set up a tripartite committee to fix the price of 
cotton seed and eliminate the provision of subsidies for inputs.  
1.35  The representative  of Mali  stated that cotton had  been a major source of  income for the 
country and accounted for more than 15% of its GDP. Furthermore, th e domestic cotton sector 
employed  more than 4 million people. He informed the meeting that a number of r eforms had  
been instituted since the last meeting and th at the Minist ry of Agriculture wa s preparing a study to 
evaluate the various reforms in order to determine the impact and to update the various strategies 
that had  been implemented . A 26% increase in production was  recorded in  2016/2017  - from 
513,000 tonnes to 647,000  tonnes.  Cotton seed s had been valued at CFA franc 245 per kg , and 
second choice cotton at CFA franc 256 per kg.  
1.36  The representative  of Cameroon  informed the meeting that through the country's Cotton 
Society Company, cotton production had reached 250,000 t onnes from 200,000 growers that 
organ ized under a bottom -up structure . The increased production stemmed  from the optimum use 
of inputs provided through credit scheme subsidies , improved seeds, agronomical research  as well 
as the support and counselling to farmers. He also stated that the main reform in the domestic 
cotton sector involved the acquisition of mode rn machines by 6000 producers.  
1.37  The representative of Zimbabwe  commended the work achieved so  far but expressed 
concern at the pace of the  implementa tion of  commitments made at the Hong Kong M inisterial  
Meeting  related to the elimination of domestic subsidies . He acknowledged the achievements made 
through the EU -Africa cotton partnership , and thanked ITC and UNCTAD for their assistance . He 
informed  the meeting  that the  domestic cotton sector  employed  an average of 51,000  peopl e 
supporting around 350,000 rural households  - approximately 1.6 million people.  He explain ed that 
the cotton sector wa s experiencing viabil ity challenges as production had  decline d partly due to 
price volatilities and effects of climate change. The land area dedicated to cotton prod uction 
declined from 300,000  hectares in  2012 to 110 ,000 hectares in 2015. The government 
interventions and fa vourable rain falls in 2017 had  raised the  potential yield to reach 
200,000  tonnes . He appealed to the M embers to commit to the elimination of  trade distorting 
domestic support related to cotton  at MC11 . 
1.38  The Chairman concluded by thank ing the d elegations who provided their latest contributions 
under this item and urged the LDCs, besides the C4 delegations, to consider submitting their 
inputs to the Secretariat for the next revision of the Table.   
DESIGNATION OF NATIONAL COTTON SECTOR FOCAL POINTS  
1.39  The Chairman  informed that the focal points re gistered so far were listed in Part  III of the ET 
on cotton and that  the S ecretariat had  not received  any new information  on additional focal points, 
the total number remained at 16. He urged the cotton proponent countries yet to designate their 
national cotton  sector focal points to do so as soon as possible so as to complete the list.   TN/AG/SCC/W/2 7 • WT/CFMC/5 5 
 
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  ANY OTHER BUSINESS  
1.40  The Chairman  invited  the representative of the Agriculture and Commodities Division  to 
provide  a brief statement  on assuming its new role as the focal point f or the Director -General's 
Consultative Framework Mechanism on Cotton . 
1.41  The representative of the Agriculture and Commodities Division ( Ms. Marieme  Fall) vowed to 
continue the work that had  been achieve d under the stewardship of the Development D ivision. She  
mentioned that the D ivision would  work hard to increa se the synergies and to assist Members with 
the implementation of their mandate on the development assistance aspec ts of cotton.  
2  CONCLUSION  
2.1.  The Chairman  concluded the meeting by reiterating the importa nce that  the Director -General 
attached  to the Cotton File . He commended the donor community as well as beneficiaries of 
development assistance for their constructive role in taking forward the discussions based on the 
Director -General 's Evolving Table. The  work of Members and  other  participants in this DGCFM C 
widely recognized as helping to consolidate the development dimension of the MTS. He also 
reiterated that the Secre tariat would  continue to assist this process by monitoring and reporting to 
Members on  new projects and progress in relation to the implementation of current activities.  He 
stressed on the importance of South -South Cooperation , and thanked the significant contributions 
made by Brazil, China and India in this area of work.  
2.2.  He informed that the Cotton File would  be dealt with by the Agriculture and Commodities 
Division. He thanked the Development Division which ha d been taking care of this file since 2013.  
2.3.  He announce d that the Director -General would  soon designate a new Chair of this 
Consult ative Framework , and that the next Round of Consultations would  take place prior to the 
last General Council meeting of the year. Specific dates would  be communicated in due course.  
2.4.  He informe d the meeting that this was his last meeting as Chair of  the DGCFMC and thanked 
all participants for their collaboration and very constructive and fruitful engagement during the last 
four years.   
2.5.  The representative of Benin  on behalf of C4 and African cotton pro ducing countries , 
expressed sincere gratitude for the trem endous work undertaken by  the Chair  
(Deputy  Director -General David  Shark ) on the cotton file. He wished him success in his future 
endeavours.  
 
 
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