WORLD TRADE  
ORGANIZATION  TN/AG/SCC/W/51 
15 March 2006 
 (06-1149) 
Sub-Committee on Cotton  
  
 
IMPLEMENTATION OF THE DEVELOPMENT ASSISTANCE ASPECTS OF THE 
COTTON-RELATED DECISIONS IN THE 2004 JULY PACKAGE 
 
Item 2C:  Coherence Between Trade and Development Aspects:
 
Update on the Development Aspects of Cotton  
 
Tenth Meeting of the Sub-Committee on Cotton (2 March 2006) 
 
Secretariat Progress Report  
 
 
 
 
 
 
 
 
1. The Director-General's Informal Consu ltative Framework (CF) process on Cotton 
Development Assistance convened in a 6th Round of Consultations, on 16 February 2006.  This first 
round of consultations after the Hong Kong Minister ial, was chaired by Mr. Stuart Harbinson. 
2. The consultations followed up to the mandates in  paragraph 1.b and pa ragraph 5 of Annex A 
of the 2004 July Framework Decision, and paragra ph 12 of the Hong Kong Ministerial Declaration.  
The consultations were technically focused on th e "revised working copy" of the Table on cotton 
development assistance, originally annexed to th e Director-General's Second Periodic Report.  
Participants interacted intensively.  Participants: 
• undertook  a first-stage "verification" exercise of the ac tual contributions, as reflected in the Table;  
• noted  the general reports from bilateral donors, mu ltilateral and regional ins titutions on "state of 
implementation and disbursements to date";  
• noted  the reports from cotton proponents on "domes tic cotton-sector reforms, projects submitted 
for funding and coordination efforts"; and also 
• noted  the report from the representative of the OE CD Secretariat on the WTO/OECD DDA Trade 
Capacity Building Database. 
                                                      
1 This document is an update to the First Periodic Report by the Director-General to the General 
Council, circulated under the symbol WT/GC/83, and subsequent updates in TN/AG/SCC/W/1, 
TN/AG/SCC/W/2, TN/AG/SCC/W/3 and TN/AG/SCC/W/4. This document has been prepa red under the Secretariat's own 
responsibility and without prejudice to the positions of Members and to their rights and obligations under the WTO. TN/AG/SCC/W/5 
Page 2  
 
  3. The consultations were indicative of con tinued progress in the implementation of the 
mandates on cotton development assistance.  They we re of practical use in providing guidance to the 
Secretariat in several respects.  The Secretaria t was encouraged by the strong unanimous support 
received from the development community on its efforts to mobilize assistance for the cotton 
proponents and to the priority accorded to actual im plementation and disbursements.  Participants, in 
particular, welcomed the continuing efforts of the Director-General. 
I. VERIFICATION OF ENTRIES  
The Development Community:  Bilateral Donors 
 
 
4. The development community verified  its entries in the "revised working Table on Cotton 
Development Assistance".  It also provided updates to prior entries. 
5. The EC and the US reported notable updates on their cotton developmen t assistance.  Japan 
reported and clarified elements of its assistance programmes. Germany, France and the Netherlands provided supplementary updates to the report by the EC.  Collectively, the bilateral donors considered 
the compilation as "necessary".  They assessed Secretar iat efforts as "very useful and a very good 
start".  They also offered useful guidance on impr ovements to the current format of the "revised 
working copy" of the Table so as to avoid overlap, improve focus on implementation, and refine the 
format for the presentation of status reports. 
6. The EC reaffirmed the "EU-Africa Cotton Partne rship" as the basis of its cotton development 
assistance.  Under the EU-ACP All Capacity Buildi ng Programme, valued at €45 million, €15 million 
had been earmarked for cotton.  In response to S ecretariat information on general budget support, the 
EC undertook to forward this information at a late r stage for individual countries.  The EC informed 
participants that its "... macroeconomic support was quite significant".  Updated implementation 
reports were also provided by other EC memb ers (Germany, France and the Netherlands). 
7. The United States reported significant updates on its cotton development assistance for 
individual proponents.  It underlined strong commitments to several cotton-producing countries in 
Africa, particularly Benin, Burkina Faso, Chad, Ma li and Senegal, through a variety of approaches, 
including West African regional assistance, country -specific assistance, and Africa-wide assistance. 
Participants were informed of the newly anno unced West Africa Cotton Improvement Programme 
(WACIP) valued at US$ 7 million for the improvement  of production, transformation, and marketing; 
US$ 9.5 million in ECOWAS support; and the approval of the Compact with Benin on 30 January 2006, under the Mille nnium Challenge Corporation (MCC) Programme valued at 
US$ 307 million.  The US was also working with other cotton proponents on their proposals and 
Compacts.  Participants were provided with upda tes on specific and relevant programmes such as 
those of the Overseas Private I nvestment Corporation (OPIC), the Citibank Africa Facility, the 
EMP Africa Infrastructure Fund, and capacity building activities in the areas of biotechnology, entomology, management, and agricultural best pract ices.  The US provided additional information on 
its new "African Global Competitiveness Initia tive", operating through "Trade Hubs". 
8. Japan clarified that all its entries had a bear ing on cotton, and endorsed the approach by the 
Secretariat. 
9. The WTO Secretariat drew attention to significant revised entries from the IMF, reflecting 
value-based calculations resulting from the Multilate ral Debt Relief Initiative (MDRI).  It was noted 
that financial resources from multilateral debt relief were available to receiving countries to apply to 
autonomously determined economic priority sectors, such as cotton.  TN/AG/SCC/W/5 
 Page 3 
 
 
  10. In concluding the verification exercise, it was understood  that: 
• the Secretariat would create a "status column " in the "revised working Table on Cotton 
Development Assistance" to show the state of operational implementation and, "time duration of 
projects"2; 
• donors and agencies would forward to the Secretaria t detailed reports of ope rational state-of-play; 
• reports from the development community would be  compiled by the Secretariat and routinely 
circulated, as addenda to the Periodic Report(s) by the Director-General; and 
• revisions to the Table on Cotton Developmen t Assistance would be work in progress. 
II. IMPLEMENTATION/ACTUAL DISBURSEMENTS  
11. Bilateral donors responded to Secretariat requ ests for implementation details and actual 
disbursements in respect of cotton programmes and projects.  They drew attention to the evolving 
degree of details involved and, in doing so, u ndertook to forward operational reports to the 
Secretariat, as appropriate. 
12. Three specific points were highlighted for l onger-term programming and planning, under this 
item: 
(a) The EU invited the cotton proponents and other African countries to immediately 
forward their development priorities, for cotton or any other priority, so that they could be taken into account in the on-goi ng preparations for the next programming 
cycle of the European Development Fund (EDF), for the period 2008-2030
3. 
(b) Japan reminded participants of its "Dev elopment Initiative, including for cotton-
dependent countries", announced shortl y before the Hong Kong Ministerial 
Conference.  Cotton proponents were reminde d that Japan's "new survey for the next 
fiscal year should be completed by July 2006" .  Japan urged recipients to enter into 
dialogue and to channel their priority need s to officials at Jap anese Embassies before 
the end of July 2006, so that they could be taken into account in Japan's development 
planning for the next fiscal cycle.  
(c) UNIDO announced that it had added two mo re countries (Guinea-Bissau and Niger) 
to its African Cotton Initiative, bringing the total number of beneficiary countries, in this first stage, to eleven
4. 
                                                      
2 To describe the state of implementation of activ ities, the Secretariat has created four operational 
categories, namely:  C for "completed"; IP for "in progress"; S for "suspended"; and D for "discontinued".  The 
time duration for programmes and projects will be expresse d in the body of the Director-General's periodic 
reports. 
3 The EDF is the main vehicle for European Deve lopment Assistance.  Programming takes place on the 
basis of expressed priorities by aid recipients, and 2006 is  the year for programming priorities in the next cycle. 
4 Benin, Burkina Faso, Cameroon, Chad, Côte d'Ivoi re, Guinea-Bissau, Mali, Niger, Nigeria, Senegal 
and Togo. TN/AG/SCC/W/5 
Page 4  
 
  Response of the Cotton Proponents and Others 
 
 
13. The cotton proponents (Benin, Burkina Faso, Chad and Mali) and others (Zambia and 
Côte d'Ivoire) welcomed the reports from the deve lopment community.  They gave strong support to 
the reported implementation action.  The propone nts noted "an increase in the level of energy 
employed" by the development community and the WT O Secretariat.  They expressed the hope that 
like assistance would be extended to other deserving African countries in similar need.  They noted 
that they would need to "relate the reported figures in the programmes and projects to their individual 
country situations".  Several were awaiting feedback from their capitals. 
III. DOMESTIC COTTON SECTOR REFORM – PROPONENTS' REPORTS  
14. Proponents provided reports, at various levels of precision, on their domestic cotton sector 
reform.  Benin  reported on the process of the privatization of the monopoly SONAPRA.  It pointed to 
several planned activities, including the establishment of  "a reserve fund for producers".  It concluded 
that domestic reform would only work more effectiv ely with the elimination of trade distortions.  
Mali  reported on a wide-ranging structural reform programme with the Bretton Woods Institutions 
currently underway.  Participants were inform ed that the cotton monopoly would be privatized 
in 2008.  Chad  reported on "a road map for domestic reform in the cotton sector", which was also 
underway.  Elements of the on-going reform in Chad included privatization, a more aggressive 
marketing, and a single price for seed cotton.  Burkina Faso  reported privatization which was on-
going.  SOFITEX no longer held monopoly sway in  the cotton sector, since the emergence of 
two other competitors, operating in the areas of cotton cultivation and management.  Côte d'Ivoire  
gave notice of privatization and reform.  All the reporters undertook to forwar d detailed statements to 
the Secretariat. 
15. Benin (on behalf of the proponents) enquire d as to how the Secretariat "envisaged" the 
implementation of the Ministerial Mandate to the DG to establish a follow-up mechanism for 
coherence between the trade policy and the deve lopment assistance aspects of cotton; and the 
"exploration" of a mechanism in respect of inco me declines in the cotton sector.  The Secretariat 
responded that the DG was intensively seized with  these matters in reflection and consultations. 
IV. WTO/OECD DDA TRADE CAPACITY BUILDING DATABASE 
16. The representative of the OECD Secretariat reporte d on the state of the Cotton Section/Box in 
the Database.  The development community was urge d to improve the quality, precision and clarity of 
its entries to the Database in respect of cotton programmes. 
V. CONCLUSION 
17. The consultations manifested a qualitatively higher technical focus.  The information 
exchange showed that implementation was evolvi ng positively, although there was scope for progress.  
The revised working Table emerged as a tool fo r the effective delivery of cotton development 
assistance for those who needed it.  It was underst ood that future consultations would evolve along 
these technical lines, focusing on the implementation of actual programmes and projects. 
 
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