Posted October 2, 2014
On Wednesday, The U.S. and Brazil ended a decade-long
dispute over subsidies paid to cotton growers, according to a Reuters article
by Paulo Whitaker available here.
ABC News also published an article here,
The Hill here,
and Feedstuffs here.
As part of the agreement, the U.S. will pay $300 million to
the Brazil Cotton Institute and Brazil will not take any further trade measures
against the United States.
“Today’s
agreement brings to a close a matter which put hundreds of millions of dollars
in U.S. exports at risk," said U.S. Trade Representative Michael Froman.
The
agreement resolves a fight between the two countries since 2002 when “Brazil
brought a case against the United States charging that the subsidies Washington
paid American cotton farmers were a violation of global trade rules.” The World
Trade Organization (WTO) ruled in Brazil's favor and the U.S. was forced to
make annual payments, according to ABC
News.
The
agreement also allows the Obama administration to implement the farm bill. A
new insurance measure intended for cotton growers was created to comply with
the WTO ruling that previous cotton support payments violated WTO rules against
subsidies.
A House
Democrat expressed concerns about the agreement, according to The
Hill.
Rep. Rosa
DeLauro (D-Conn.) said the United States, “never should have been in a
situation where we have to pay off Brazil while vulnerable families suffer.”
“Our farm
subsidies need serious reform and the last farm bill simply extends the status
quo. The best way to resolve this issue is to remove our market-distorting
cotton payments,” said Rep. DeLauro.
Secretary
Vilsack also made a statement, according to Feedstuffs.
"Through
this negotiated solution, the United States and Brazil can finally put this dispute
behind us. Without this agreement, American businesses, including agricultural
businesses and producers, could have faced countermeasures in the way of
increased tariffs totaling hundreds of millions of dollars every year. This
removes that threat and ensures American cotton farmers will have effective
risk management tools."
For more information on international law and organizations,
please visit the National Agricultural Law Center’s website here.
