RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/AG/SCC/R/6 
21 October 2005  
 (05-4858) 
Sub-Committee on Cotton  
 
 
 
 
SUMMARY REPORT ON THE SIXTH MEETING OF THE SUB-COMMITTEE 
ON COTTON HELD ON 28 SEPTEMBER 2005 
 
Note by the Secretariat1 
 
 
1. The Sub-Committee on Cotton, which was esta blished by the Committee on Agriculture, 
Special Session at its formal meeting on 19 No vember 2004 in accordance with the instruction 
resulting from the decision on the Doha Work Pr ogramme adopted on 1 A ugust 2004 by the General 
Council (WT/L/579, refers), held its sixth meeti ng on 28 September 2005 under the chairmanship of 
Ambassador Crawford Fa lconer of New Zealand. 
2. The agenda as contained in WTO/AIR/2661 was adopted. 
ITEM A : ELECTION OF THE CHAIRPERSON  
 3. Although the General Council, at its 29 July  2005 meeting, had appointed Ambassador 
Crawford Falconer to the positions of Chairman of  the Committee on Agriculture in Special Session 
and Chairman of the Sub-Committee on Cotton, the ru les of procedure required that this appointment 
be agreed by the Sub-Committee.  It was so agreed. 
I
TEM B:  ASSESSMENT OF PROGRESS IN THE AGRICULTURE SPECIAL SESSION  
(i) Statement by the Chairman 
4. Under this agenda item the Chairman gave his assessment of progress in the agriculture 
negotiations with a particular focus on cotton.  A summary of the  statement made by the Chairman is 
attached to this report (see Annex 1). 
(ii) Submission by the African Group:  "Proposed Elements of Modalities in Connection 
with the Sectoral Initiative in Fa vour of Cotton" (TN/AG/SCC/GEN/2) 
5. Egypt, speaking on behalf of the African Group,  recalled that the Group had tabled a proposal 
contained in TN/AG/SCC/GEN/2.  The document pr oposed elements of modalities in connection with 
the sectoral initiative in favour of cotton and dealt with both the trade and the development aspects of 
the initiative.  In that regard, Eg ypt wished to underscore the four  basic elements of the proposed 
modalities put forward by the African Group for cotton:  duty and quota free market access; 
elimination of all forms of export subsidies by 1 Ju ly 2005;  elimination of trade-distorting domestic 
supports by 21 September 2005;  and the fourth elem ent related to technical and financial assistance 
for the creation of an emergency fund. 
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or to their rights or obligations under the WTO. TN/AG/SCC/R/6 
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 6. The representative of Egypt noted that time, but  also the dates mentioned in the proposed 
modalities, had passed and the African Group was still waiting for reactions from other Members.  Egypt stated that the African Group was committed to  the success of the negotiating process and the 
Group urged partners to respond to its proposals in  a manner which would successfully lead to the 
desired outcome.  
7. Kenya noted its support for the statements ma de by the African Group and the LDC Group of 
countries.  The representative of Kenya recalled that  at the last meeting of the Sub-Committee, Kenya 
had enquired as to how Members intended to prog ress in the Sub-Committee since what Members 
expected from the Sub-Committee were specific r esults regarding the Cotton Initiative.  Indeed, 
Kenya recalled that the mandate in the July Framework clearly said that, apart from addressing the 
issue expeditiously, Members also had to be specifi c in handling the cotton issue.  Hence the question 
was how to progress in addressing cotton specifically because, as already highli ghted by Kenya, while 
reports on progress in the overall agriculture ne gotiations were useful, Members in the Sub-
Committee also needed to h ear specific progress reports with regard to  cotton.  This lack of specificity 
with regard to progress for cotton was, in Kenya's view, the reason behind the frustration expressed by 
Burkina Faso and Benin. 
8. Kenya concluded by stating that Members needed  to understand what were the specific results 
of the negotiations and the consultations for the Co tton Initiative.  Given the limited time, Kenya was 
concerned about obtaining concrete  results in Hong Kong if Members did not address the cotton issue 
specifically.  Kenya whished to find out how the Chai r intended to progress with the issue in order to 
ensure that Members did have the results whic h they were seeking in Hong Kong on cotton. 
9. The representative of the Eur opean Communities noted its agreement with the Chairman's 
assessment that Members had entered in a negotiating mode with signs of movement starting to appear, and that while there was still quite a l ong way to go between now and Hong Kong, successful 
negotiations were still feasible.  The European Co mmunities stated that the common objective for all 
Members was to have full modalities for Agricultu re in for Hong Kong, this meant figures for 
reductions in domestic support, figures for e xport competition and figures for full modalities for 
market access. 
10. Referring to earlier interventions on the fact th at Members were lagging behind in cotton and 
that they had not been specific, the European Co mmunities noted that it had been much more specific 
in cotton than it, or for that matter any other Memb er, had been for other agricultural products.  The 
European Communities had stated clearly, as reflected in the minutes of the relevant meetings, that it 
could accept as from day one of the implementation of the DDA Agreements, quota and duty free 
access of cotton not only for LDCs but for all Memb ers.  This was a very specific proposal and the 
European Communities did not believe that any Memb er had been as specific for any product in the 
discussions so far.  Secondly, the European Communities had stated that as far as cotton was 
concerned as from day one from the implementation of the DDA Agreements, it could accept the total 
elimination, consolidated in the schedules, of e xport subsidies.  This was clearly, a specific, 
expeditious and ambitious proposal from the Eu ropean Communities.  Thirdly, the European 
Communities had stated that as from day one of th e implementation of the DDA Agreements, it could 
accept a very substantial reduction of internal domes tic support.  The representative of the European 
Communities noted that, in that regard, the Europe an Communities had been preparing itself in its 
domestic reform and would, as of 1 January 2006, ha ve decoupled 65 percent of its internal support 
for cotton. 
11. In light of the specific proposals detaile d above, the representative of the European 
Communities noted that as far as cotton was concer ned, the European Communities had proposed far 
more than for any other agricultural product so far,  and hence it did not agree with the statement made 
by Burkina Faso that there had not been specifi c answers to the modalities proposed by the African 
Group.  The European Communities had previously  provided the same specific answers detailed  TN/AG/SCC/R/6 
 Page 3 
 
 
 above to the modalities proposed by the African Group,  at the April and July meetings of the Sub-
Committee, and this was reflected in the corresponding Secretariat summary reports.  The representative of the European Co mmunities noted that Members had collectively agreed to handle 
the cotton issue specifically, expeditiously and amb itiously and called for specific reactions from the 
Membership on the African Group proposal. 
12. The representative of Brazil reiterated the impor tance of the cotton issue, not only to the 
African countries, but to all developing members of th e Organization with an interest in the matter.  
Brazil again welcomed the proposed modalities from the African Group as an effort in addressing the 
problem in an ambitious, expeditious and specifi c manner, as mandated by the July framework.  
Referring to an earlier call by the Chair for a gr eater level of engagement by Members in the 
agriculture negotiations, Brazil expressed the hope for a greater engagement by developed Members, 
and in particular by the major players, in movi ng forward the negotiations.  Time was running short 
and Brazil, like the G-20, remained fully committe d to a successful outcome to the negotiations,  
including inter alia  effective reductions in all trade-distorting agriculture practices.  Brazil stressed 
that trade-distorting domestic support practices had a ma jor impact in the trade not only of cotton but 
of all the other agricultural products and it hoped to see a strong Membership engagement on that 
issue. 
13. Statements made by the following delegations  were forwarded to the Secretariat and are 
attached to this summary report:  Benin, Burkina Faso, the United States, and Zambia (see Annex 2). 
I
TEM C:  COHERENCE BETWEEN TRADE AND DEVELOPMENT ASPECTS : UPDATE ON THE 
DEVELOPMENT ASPECTS  
14. The Chairman recalled that the terms of re ference establishing the Sub-Committee on Cotton 
clearly referred to the need for coherence betw een the trade and development aspects of the cotton 
issue (paragraph a, TN/AG/13 refers). 
(i) Statement by the Secretariat 
15. On behalf of the Secretariat, Mr. Chie du Osakwe provided the Sub-Committee with a 
progress report on the implementation of the development assistance aspects of cotton.  The 
Secretariat report provided an update on various ac tivities related to development assistance delivered 
bilaterally by individual countries and multilaterally by international organizations, including what the 
Secretariat saw as real progress in contributions and concrete indications of further advances. 
16. The statement made by the Secretariat has been circulated as document TN/AG/SCC/W/4 and 
is also attached to this report (see Annex 3). 
(ii) Statements by Observer Internationa l Intergovernmental Organizations 
17. There were no statements by Observer Inte rnational Intergovernmental Organizations. 
(iii) Statements by Members 
18. The statement made by Benin is att ached to this report (see Annex 3). 
19. The European Communities thanked the Secret ariat for its report and noted that the 
preparation of an overall report by the Director General, similar to the First Periodic Report to the 
December 2004 General Council (WT/GC/83 and A dd.1), would greatly assist to update the 
Membership on developments since the launch of the Cotton Initiative at the General Council 
two years ago.  The representative of the European  Communities noted that the launch of the Sectoral 
Initiative had had an enormous bandwagon effect w ithin the European Community's institutions and TN/AG/SCC/R/6 
Page 4  
 
 among the Members States and also for many other members of the international community who had 
been alerted to the various serious problems in cotton and had started putting assistance together, internationally, regiona lly and nationally.  The European Communities had presented its EU-Africa 
Action Plan on Cotton to the Sub-Committee in July a nd, earlier in the month, at the ICAC meeting in 
Liverpool. 
20. The representative of the European Communiti es noted that the European Communities had 
been active in the last two years at the inte rnational level with commodity capacity building 
programmes and risk management at national levels, including bilaterally by Member states, and in 
regional programmes as had other major WTO Members.  The representative of the European Communities noted that when putting in place these ki nds of programmes, very rapid results could not 
realistically be expected because for example, from the European Communities perspective, it was 
working on the whole sector of cotton, which implied quite a lot of restructuring over a number of years.  Furthermore the assistance was planned and implemented in full partnership with the beneficiary countries concerned and obviously that also took some time.  However, the European 
Communities was confident that all those actions wh ich had been taking place in the last two years, 
and which would continue to happen, on the develo pment side, would have a long lasting beneficial 
effect on cotton-producing countries. 
21. In addition to its statement attached in Annex 3,  Benin noted that the lack of interventions by 
Observer International Intergovernmental Organizations  at this meeting reflected the fact that no new 
substantial development had taken place since the last meeting of the Sub-Committee.  Benin, on 
behalf of the four co-sponsors of the Sectoral In itiative in Favour of Cotton and of all the African 
cotton-producing countries, expressed its appreciatio n to the bilateral, multila teral, regional and sub-
regional partners who had alread y proposed or mobilized technical and financial assistance for 
African cotton-producing countries. 
22. Benin, echoing the European Communities suggestion, noted that it had at previous meetings 
of the Sub-Committee recommended that by way of an evaluation, the WTO Secretariat draw up a 
summary table of the technical and financial assistan ce granted.  Benin stressed that such a summary 
table would be important for the visibility of actions  undertaken by partners and also for its records. 
23. The representative of Benin added that while  several measures had been announced, these 
were mostly declarations of intent and the time factor, between the announcement of a measure and its 
implementation, had to be taken into account.  Th e widespread disaster and the helplessness of cotton 
producing countries were such that they were hoping  for a massive response in order to save the 
cotton sector.  Benin did not wish to overlook what  bilateral and multilatera l partners had done and 
for which it was very appreciative, but the im portant goal remained that of preventing the 
disappearance of the cotton sector from the econom ic horizon of African countries.  All Members 
would have failed if such a disappearance occurred, which is why Members had to work together in 
tackling the development aspect to save the sector pending the resolution of the trade aspect of the 
cotton issue. 
24. Benin informed the Sub-Committee that the co-s ponsors of the Sectoral Initiative had asked 
their Governments also to take stock of all that had been done on the ground so that in the course of 
future meetings, they would be able to add to th e Secretariat's inventory of specific measures, thus 
allowing for a balanced two-sided view of  the various development-related actions. 
25. The Chairman asked that any delegation that wa nted its statement included as an attachment 
in the summary report on the formal meeting should send it to the Secretariat in electronic format as 
soon as possible. 
  TN/AG/SCC/R/6 
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 ITEM D:  OTHER BUSINESS  
Date of the Next Meeting 
26. The next meeting of the Sub-Committee was tentatively scheduled for 28 October. 
Chairman's Report to the Special S ession of the Committee on Agriculture 
27. The Chairman stated that in making his repor t on the meeting to the Special Session of the 
Committee on Agriculture, he would bear in mind the statements made by all Members, and that the 
report would be short and entirely factual.  Keeping in mind the interests of all Members, the report would be circulated to Members and if a factual error was discovered an amendment would be issued. 
  TN/AG/SCC/R/6 
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 Annex 1
 
 
Statement by Ambassador Crawford Falconer of New Zealand 
at the Sixth Meeting of the Sub-Committee on Cotton held on 28 September 2005 
 
 
Agenda Item 2(B)(i):  Assessment of Pr ogress in the Agriculture Special Session  
 
  As far as assessment is concerned, you will all of  course be familiar w ith what Tim Groser, as 
Chair, had provided at the end of July and sin ce that period, we have had one meeting of the 
Agriculture Special Session and we have had, in th e context of that meeting, informal meetings and 
you among yourself have had various perm utations and combinations of meetings with each other in 
various structure and format.  As we all know ther e have also been meetings outside this town, 
dealing with agriculture in general and the imp lications of that for cotton among other things. 
 
 I will do my best to try and sum things up brie fly and it is only my own very subjective view 
of things and it certainly has no particular status other than giving you a sense of where I think we are 
at this particular time.  I have the sense that sinc e July, there is a genuinely more active engagement in 
regard to the agriculture negotiations.  I think that it is  fair to say that there is much greater intensity in 
many capitals about the need to move the negotiations  forward from what was I think fairly described 
as a stale-mated position at the end of July.  I think the message that was delivered, and was 
understood, was that if things stayed where there were at the end of July, we would not be in a 
position to make the kind of progress that we need to  make by Hong Kong in order to conclude the 
negotiations next year as Ministers have directed us to do and in accordance with the terms that are 
laid down in the Doha Mandate  and reaffirmed in the July Framework of last year. 
 
 I think that that message was understood and I think that as you would expect, there has been a proper and serious attention in capitals to findi ng the sufficient flexibility that would enable the 
process to move forward.  But as always, having the kind of attention both political and technical 
needed to deal with the issues do es of course have to translate into something that is operationally 
effective on the ground and which actually achieves moving forward.  And I suppose the way I would 
describe it is that it is probably fair to say that at this point in time we are in a kind of transitional 
moment.  The question remains whether that can be  operationally translated into something on the 
ground that makes a meaningful difference to where we we re at the end of July?  It is a very particular 
thing to be able to find a way to make those thi ngs happen and I do not think we are at this point, at 
the point where those things are really happening. 
 
 However, I do not mean by that that the engagement is not active and continuing.  If anything I have the sense from discussions that have been  taking place, both during the Agriculture week and 
subsequently among more restricted groups, on a certa in key issue, not on all issues, that there is a 
greater degree of engagement than there was.  I do not have the feeling from what I understand of 
those discussions that there are any great breakthroughs yet, but there are signs that people are 
beginning to try and find a way to look for options that might work.  And I think that is worth 
recording because although it does not amount to someth ing that you could say transforms the process 
just yet, at least it is somewhat of a hopeful si gn and whether it can be translated into something 
concrete remains to be seen.  I think it is comp atible with what was I thought a very clear message 
that I received particularly during the Agricultural W eek which is that Members expect us to be in a 
"bottom-up process".  So it is something where Members themselves have to bring things to the table. 
  This cannot be imposed in terms of the way forward by anything that comes from the Chair, or from up high, but needs to be generated by Member s.  I think that is also clear and I do not see 
anything at this point that leads me to doubt the commitment of people to that, but a process of that 
kind only moves by expending concentric circles, an d small groups from time to time also have to be  TN/AG/SCC/R/6 
 Page 7 
 
 
 able to expand and take into account the interest of  all Members so that when and if there are serious 
negotiations which affect the interest of particul ar Member, those kinds of decisions are not taken 
with them out of the room and that they are invol ved in a way that ensures that those interests are 
actively protected and that everybody can theref ore own both the process and the outcome of the 
process.  Certainly that was a clear message that I received from the Agricu lture Week and something 
that I remain committed to, something that I tried to  follow in the consultations that I have had with 
Members during that week and that I intend to conti nue to follow.  And I am of course, completely 
realistic about the fact that you cannot ever negotia te anything simply in an open room from the get 
go, but you do have a responsibility to make sure th at things do not happen in completely closed 
rooms and I am hopeful that we will manage that pr ocess in a way that is essentially protective of all 
Members' interests. 
  Now, stemming from that, as you will be aware I hope, I have called an informal open-ended 
meeting of the negotiating group on agriculture fo r Tuesday of next week.  I think that it is 
appropriate that we have a genuine opportunity multilaterally to review where we are in the 
agriculture negotiations in the light of various di scussions that have taken place and some of them 
have still to take place before that time, so that people can be as frank with each other as possible.  
And I would hope that in the course of next week, the opportunity of having that meeting on Tuesday, 
and I would imagine that we want to meet again to wards the end of that week, will provide a further 
opportunity for delegations to meet together in bilate ral contexts and in plurilateral contexts in a way 
that will further advance what I see as an attempt to reach convergence. 
 
 Now, I as Chair will use that time next week to continue my process of meeting with delegations individually and collectively.  I have not yet settled in my own mind what kind of formats 
I might use for any meeting that I would convene in addition to the full open-ended informal sessions 
but it is possible that I would want to meet w ith various groups of Me mbers and I will hopefully 
within the next day or so, communicate that to y ou.  And I would use the opportunity on Tuesday to 
give you as best I can my own glance on where we are, hopefully other dele gations will do the same, 
and then on Friday to be in a position to give some  sense of where we are at the end of the week.  
I think we have a pretty serious amount of work that  needs to be done next week in order to ensure 
those putative signs of engagement do in fact beco me more operational and start to lead somewhere. 
 
 That is about as much as I would want to say.  You will also have seen that I had intended and 
I still do have the intention of calling what I called my "Doctor's Clinic" this Friday afternoon, for 
transparency purposes.  I do not see any reason for having capital-based officials there, but I think it 
would be useful for those of you who are interested in the exchange to have a view on where we think 
we are and perhaps on my plan for the way ahead next week.  So that is my assessment.  I do not have 
any doubt that the amount of work we have to do in  the period ahead is very daunting, there is not a 
lot of point dwelling on that because if we are going to succeed in our task we have to focus precisely 
on finding a way to try and meet t hose challenges and that is certainly  the approach I want to follow 
in the weeks ahead.  So that is my summary of wh ere I think we are and I would be happy to open the 
floor to comments from delegations. TN/AG/SCC/R/6 
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 Annex 2
 
 
Statements at the Sixth Meeting of the Sub- Committee on Cotton held on 28 September 2005 
  
Agenda Item 2(B)(ii):  Submission by the African  Group: "Proposed Elements of Modalities in 
connection with the Sectoral Initiative in favour of Cotton" (TN/AG/SCC/GEN/2)  
 
 
Statement by Benin  
 
 Mr. Chairman, Excellencies, Representatives of International Organizations and Regional and Sub-Re gional Organizations, 
Distinguished Delegates, 
Ladies and Gentlemen,    This meeting of the Sub-Committee on Cotton co mes at a crucial stage in our negotiations. 
 
 Indeed, we are exactly two and a half m onths away from Hong Kong and the cotton issue 
remains to be dealt with in full.   Yet, I recall, at the end of July 2004 – over one year ago already - the WTO General Council gave us a clear mandate on cotton, in structing us to address the issue " ... ambitiously,  expeditiously, 
and specifically , within the agriculture negotiations  ... " and specifying that the work should 
encompass " ... all trade-distorting policies affecting th e sector in all three pillars of market 
access, domestic support, and export competition  ... ". 
  It was with this in mind that on 29 April 2005 the African producers and net exporters of 
cotton submitted to WTO Members for cons ideration a document of 22 April 2005 
(TN/AG/SCC/GEN/2) containing "Proposed elements of modalities in connecti on with the Sectoral 
Initiative in Favour of Cotton".   These proposals address measures we regard as es sential in confronting the problems facing 
the cotton industry in Africa. 
 
 The measures can be summarized as follows:  1. Market access
:  improve market access for interna tional trade in cotton, and grant LDC 
cotton producers and net exporters  bound duty-free and quota-free access for cotton and its by-
products; 
 
2. Export subsidies :  eliminate all forms of export subsidies on cotton by 1 July 2005  at the 
latest;  3. Domestic support
:  eliminate domestic support measures that distort international trade in 
cotton by 21 September 2005 at the latest ; 
 4. Emergency support fund for cotton
:  establish an emergency support fund for cotton 
production in order to contain the serious socio economic consequences for the farming communities 
resulting from loss of revenue due to the drastic  decline in cotton prices on the global market. 
  TN/AG/SCC/R/6 
 Page 9 
 
 
  The resources allocated to the fund shall be equi valent to 20 per cent of the value of cotton 
production for the most favourable of the three most  recent years in each of the countries concerned. 
  The operation and management of the fund have been outlined in paragraph 27 of the 
document containing our submission on elements of  modalities, the goal being a participatory and 
inclusive system that ensur es transparency in the way the resources are allocated. 
  The justification for the proposal to create such  a fund is based on the need to adopt a safety 
net for cotton producing communities in the thirty -three African cotton producing and net exporting 
countries and to save them from economic disaster which would lead to the plain and simple 
disappearance of cotton production in Africa. 
  Since we submitted the elements of modalities exactly five months ago, there has been no 
concrete response from any of the WTO Members th at grant subsidies and domestic support to their 
cotton producers and farmers. 
 
 We wish to take the opportunity at this meeting of the Sub-Committee on Cotton to draw attention once again to the grave difficulties confron ting the cotton sector in African countries, and to 
our need for appropriate responses to this issue.   A response along the lines of our collective decision of July 2004 concerning the cotton 
negotiations would reflect the commitment that WT O Members, particularly the major players in 
international trade, undertook really to make trade an engine of growth and development. 
  We have a duty to act, and to act quickly, because Hong Kong is now close.  
 Tomorrow is already here, as the saying goes, a nd we are worried that the lack of a prompt 
response to the cotton issue will penalise our countries and the cotton producing communities even further.   Thank you for your attention.  
 
   TN/AG/SCC/R/6 
Page 10  
 
 Statement by Burkina Faso
 
 
 
Mr. Chairman, 
Excellencies, 
Representatives of development partners, 
Ladies and Gentlemen,    First of all, on behalf of my delegation, a llow me to congratulate you on your election as 
Director-General to the WTO and to say how happy I am to see you presiding over the Sub-
Committee on Cotton for the first time.   I have no doubt that you will make every effort  to move the Sub-Committee's work forward, 
to the satisfaction of all parties. 
 
 I would, however, like to express our great concern at the slow pace, and even the absence, of reactions to the proposed modalities submitted by  the African cotton-producing and net cotton-
exporting countries since 29 April 2005.   We made this very same point at the last me eting of the Sub-Committee and I hope that today 
our appeal will be heard by all delegations present. 
  You will, of course, understand that, two and a half months before the Sixth Ministerial 
Conference, we are becoming concerned at the results achieved.  
 There is no need to go over the difficulties faced by the cotton sectors in our respective 
countries, as we have addressed such issues at length in the past.   If action is not taken immediately, these sectors will be condemned to disappear and millions of farmers in our countries will join the ranks of the poor.  
 Mr. Chairman, with a little political will all r ound, I am sure that we will achieve positive 
results in Hong Kong.   We therefore urge you to intensify consultati ons with the different groups as time is running 
out. 
 
 Thank you.  
    TN/AG/SCC/R/6 
 Page 11 
 
 
 Statement by the United States  
   The focus of our negotiations in recent weeks h as been on the chair's approach to integrate all 
pillars – market access, domestic support and export co mpetition.  This is a good thing, as it allows 
countries to assess whether the whole package is coming together for the Hong Kong Ministerial. 
  Certainly in that context the United States h as been pressing for ambitious results in market 
access, which will, by necessity, bring along ambitious results for cotton on tariffs and trade-distorting 
domestic support. 
 
 We have studied the proposal put forward by  the African Group last April, and have noted 
previously that some of the proposed elements fo r modalities for cotton won't be achieved in the near 
term, but the higher the level of ambition for the over all package the closer we can get to those goals. 
 
 Hence, we look for the support of other members as we strive to achieve the highest level of 
ambition possible.  
We appreciate the Secretariat's regular updat es on the development aspects of cotton and note 
that the United States continues to  actively work with the C-4 and other countries.  However, we are 
not in a position to support any type of in ternational emergency fund for cotton.  
 
  TN/AG/SCC/R/6 
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 Statement by Zambia
 
  Mr. Chairman,  
 I take the floor to speak on behalf of the le ast developed countries on this important topic on 
cotton.   I would like to associate the Group with the statement made by Egypt on behalf of the African Group. 
 
Mr. Chairman,   May I start by commending you for the work you have undertaken in the few weeks you have 
assumed Chairmanship of this Sub- Committee, to try and resolve the rather complex but important 
concerns that cotton producers would like addressed in the context of the current negotiations under 
the Doha Development Agenda.   As has been stated in this house and many at  other fora organized on the Cotton Initiative, the 
production and trade in Cotton is an important preocc upation for the majority of people in many of 
our countries.  However, the livelihoods of these peopl e are threatened by the volatile market prices of 
cotton on the international markets, a situation perpet uated by policies that distort trade.  It should 
therefore remain a matter of priority to address th e concerns raised by cotton producers ambitiously, 
expeditiously and specifically in the current round of negotiations. 
 Mr. Chairman, 
 
 May I at this point recall that the mandate on cotton was two folds; to deal with development 
related issues multilaterally with international financial institutions  and through bilateral programme, 
and to pursue the trade related aspects within  the context of the agriculture negotiations. 
  As LDCs, we appreciate the initiatives undertak en by the office of the Director General 
through a consultative process as a means of impl ementing the development related aspect of the 
Cotton initiative.  We are grateful to those institu tions and cooperating partne rs that have responded 
positively to this call and look forward to many othe rs coming to the aid of cotton producers not only 
in the four African states but to other LDC cotton producers as well.  
 While the process on the development side h as gained some headway since the establishment 
of the Sub-Committee on Cotton, it remains an issue of  concern that the trade related aspect of this 
initiative has hardly been given due attention in th e three pillars of the negotiations on Agriculture.  
The mandate in agriculture is  to address the cotton problem ambitiously, expeditiously and 
specifically in the current negotiations.  We would therefore like to see quick results achieved on this 
issue in line with the mandate, at the latest by th e Hong Kong Ministerial Conference.  In this regard, 
we urge the WTO Members to work constructivel y to achieving a positive outcome on both fronts of 
the negotiating mandate in favour of the cotton producers.  Thank you.  
 
  TN/AG/SCC/R/6 
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 Annex 3  
 
Statements at the Sixth Meeting of the Sub- Committee on Cotton held on 28 September 2005 
 
 
Agenda Item 2(C):  Coherence Between Trade and Development Aspects:  
Update on the Development Aspects of Cotton   
 
 
Statement by the Secretariat  
 
 
1. Under this standing item, the Secretariat has pr ovided three prior updates to the Membership.  
The base report was the substantive First Peri odic Report by the Director-General to the 
December 2004 General Council (WT/GC/83 and Add. 1).  The subsequent progress reports were 
provided on 22 March 2005 (TN/AG/SCC/W1), 29 April 2005 (TN/AG/SCC/W2) and 18 July 2005 (TN/AG/SCC/W/3).  These reports are be fore the Sub-Committee on Cotton (SCC). 
2. The updates to Members have been based on the information provided by Members and the 
relevant multilateral institutions, following four ro unds of consultations in the informal consultative 
process established by the Director-General to implement Council decisions on the development assistance aspects of cotton.  Since the last (4
th) round of informal consultations on 18 July, no further 
consultations have taken place.  The Secretariat inte nds to hold the next round of consultations before 
the 6th WTO Ministerial Conference. 
3. At today's meeting, the Secretariat would lik e to emphasise that there continues to be a 
positive evolution of results in the implementation pro cess.  Overall, there is real progress in respect 
of contributions by bilateral donors and contribu ting multilateral institutions, with indications of 
further advances.  These would be reported in th e next substantive report by the WTO Director-
General. 
4. Implementation of the decisions on the devel opment assistance aspects is work in progress, 
and needs to be deepened.  As an indicative su mmary, in the information provided by Members and 
relevant multilateral agencies, the range of technical  and financial assistance given, including actual 
cotton-specific projects underway, those planned,  and those requested, specifically cover: 
− Reflection of cotton sector priorities in b ilateral donor/multilateral agency programmes; 
− Design of cotton-specific programmes/activities in  bilateral/multilateral agency programmes; 
− Debt relief/Increase in financial and aid flows2;  and 
− Actual/Planned cotton sector-specific technical assistance activities cover: 
 Capacity building (seminars, conferences,  training, agricultural best practices); 
 Research/Skills and Technology transfer in areas such as ginning, cotton testing, 
labelling, grading and classing;  soil degr adation, soil fertility improvement and 
management, bio-technology, bio-safety training, entomology, high yield, disease resistant transgenic cotton varieties; 
 Infrastructure (roads, railway systems, construction of training schools, etc); 
 Private sector development; 
 Cotton promotion and market search; 
                                                     
 
2 The point has been made about the fungibility of financial assistance and aid flows. TN/AG/SCC/R/6 
Page 14  
 
  Regional strategy for policy and ins titutional support (WAEMU, ECOWAS); 
 Restructuring of producer associations; 
 Agricultural-linked projects (irrigation systems, rural development, etc); 
 Value-added projects and Chain Integr ation (e.g. textiles and clothing); 
 Fiscal/price support; 
 Market-based price risk and price stabilization instruments; 
 Poverty Reduction & Growth Facility (PRGF) augmentation.
3 
 5. However, there are three areas where scope exis ts for further progress.  First, the need for 
increased coordination and enhanced partnerships at the level of bilateral donors, agencies and the 
proponents themselves.  Second, the need for th e proponents to formulate specific cotton sector 
priorities in keeping with the priority attached to co tton and as reflected in their priorities.  Third, the 
need to accelerate and deepen the on-going transfor mation from programmes and design of projects to 
actual operational projects. 
6. Since the last progress report, there have been several additional developments. 
• First
, at the 64th Plenary Meeting of the International Cotton Advisory Committee (ICAC), the 
ICAC Secretariat on behalf of the Organizat ion, "offered" to contribute towards the 
implementation of the development assistance aspects and to assist "financially stressed 
producers, particularly in Africa".  Identified areas of support were technology development;  
technology transfer to raise yields and lower costs,  through more efficient application of inputs;  
improvements in access to yield-enhancing input s;  and, to encourage acceptance of new 
technologies, including biotechnology, by cons umers and governments.  The WTO Secretariat 
met bilaterally with the ICAC Executive Director  to explore their offer and undertook to report 
this new opportunity to Members, which is hereby reported. 
• Second , the United Kingdom (on the platform of the EU Presidency) underlined a strong 
commitment for a successful Hong Kong Ministeria l meeting and overall Doha outcome and, in 
doing so, underscored the impor tance of progress on cotton.  This was followed-up with a 
formally circulated statement by the Representative of the EU reporting on progress by the 
European Communities, inter alia , on the implementation of the de velopment assistance aspects 
of the cotton issue (and pointing to EU dom estic measures for progress on the trade aspects). 
• Third , information and data provided at the meeting by ICAC indicated the continuing long-term 
decline in global cotton prices, the continuing gl obal decrease in average revenue per hectare, in 
spite of recent demand growth for cotton, and the continuing decrease in  the market share for 
cotton relative to total fibre consumption.  Reports  at the meeting also indicated that, globally, 
producers were focusing efforts on the applicati on of improved technology, biotechnology, high 
yield disease resistant varieties to improve quality, efficiency and productivity.  ICAC is attentive 
to government measures that distort trade and gr owth in the cotton sector.  A specific report was 
circulated to the ICAC Plenary, by the Chai r, of the Working Group on Government Measures 
(WGGM). 
• Fourth , there are strong positive developments on Aid-for-Trade, as reflected in the recently 
adopted "Development Committee Communiqué", at the Development Committee in 
Washington, on 25 September.  The endorsement of the proposal, by the Development 
Committee, to enhance the Integrated Framework, including the expansion of its resources and, to 
make the IF more effective, is likely to provi de important new opportunities in areas identified as 
priorities by beneficiary members.  The Development Committee also welcomed the World Bank's ambitious Africa Action Plan. 
                                                     
 
3 Augmentation will be provided, if external financing requirements result from terms of trade shock 
(IMF contribution).  TN/AG/SCC/R/6 
 Page 15 
 
 
 7. These updates for the Membership are not isolated.  The Secretariat progress reports on the 
implementation of the development assistance aspects  are linked.  It is work in progress.  The 
Director-General, inter alia , remains seized with the issue of cotton.  This was conveyed to the 
meeting of the Director-General with the proponents on 12 September 2005. 
 
 TN/AG/SCC/R/6 
Page 16  
 
 Statement by Benin
 
  Mr. Chairman, Excellencies, 
Representatives of International, Regi onal and Sub-regional Organizations, 
Distinguished Delegates, Ladies and Gentlemen,   
The Framework Agreement adopted by the WTO General Council at the end of July 2004 on 
the development aspect of the Sectoral Initiative in  Favour of Cotton recommended that technical and 
financial assistance be mobilized  to support the cotton industry in African cotton-producing countries, 
in accordance with the conclusions of the WTO Regional Workshop on Cotton held in Cotonou on 
23 and 24 March 2004. 
On behalf of the countries that co-sponsored the Sectoral Initiative in Favour of Cotton, 
I should like to thank those bilateral, multilateral, re gional and sub-regional part ners that have already 
announced or mobilized technical and financial assistance in favour of the African cotton-producing countries. 
At previous meetings of the Sub-Committee,  we recommended that the WTO Secretariat 
carry out an assessment, in the form of a table summarizing the technical and financial assistance 
provided. 
With regard to the development aspect in par ticular, such an approach would underpin our 
work as follows: 
 - Actions and initiatives taken by countries a nd institutions to promote the cotton industry 
in African cotton-producing countries would become more visible; 
 - Organization of the action undertaken would be rationalized; 
 - Follow-up of action taken in the field, bot h by delegations in Geneva and competent 
services in the capitals would be facilitated. 
It was along these lines that, a few days ago, my country sent a letter to the Director-General 
on behalf of the four co-sponsors of the Sectoral In itiative in Favour of Cotton inviting him to request 
the evaluation services to conduct an assessment of th e technical and financial assistance provided. 
We would like to receive an update on this issue at the next session of the WTO General 
Council, to be held on 19 and 20 October 2005.  It is necessary to carry out this task in order to assess 
the efforts made in this field. 
 Thank you. 
 
 
 
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