African Cotton Farmers Hurt by Subsidies
Falling cotton prices hurt African farmers far more than their American counterparts. And American subsidies may be to blame for the Africans' pain, according to a documentary on Dev.tv, a nonprofit media outlet.
American farmers profit by growing more cotton since the U.S. government has promised them a fixed price no matter how much they produce. But American subsidies cause the market to be flooded with cotton, according to an industry expert in Benin, Bernard Adikpeto. "Because the U.S. subsidizes its cotton production, its farmers put a surfeit of 1 million tonnes in the market in 2001, leading to a drop in cotton prices."
On the other hand, African farmers don't get any subsidies, so they are hit hard when cotton prices fall in the free market. Consequences are especially bad because this crop is a crucial source of income in countries of Central and West Africa. For example, the cotton industry in Burkina Faso employs more than 2 million people and generates 40 percent of the nation's export revenue. Nearly 40 percent of Chad's population is involved in producing cotton, and two-thirds of its total export comes from this crop. In all, more than 10 million African farmers have lost income since the price of cotton fell worldwide.
What's ironic is that African farmers are losing money while selling a product they produce more competitively than others. Central and West African countries produce cotton at half the cost of the U.S. and Europe. Yet, these African nations bear a loss of $1 billion in the cotton economy every year.
To learn more on this topic, you can watch the documentary below :
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I already eared about this
I already eared about this problem something like 10 years ago. As long as subsidies stay how they are in developed country, it's not possible to expect a growth of all Africa. There is the same problem with lot of raw material. Thanks for the video.
loi scellier
Farm Subsidies in the U.S.
While it is widely acknowledged that farm subsidies in the U.S. prohibit farmers in developing countries from competing in the world market, these subsidies continue, as pointed out by this story and the previous comments. It would appear that congressional representatives do not wish to re-evaluate agricultural policy with respect to subsidies because the livelihoods of their constituents would be threatened if subsidies were lowered. If the U.S. government is to address the issue of subsidies, it must create strategies for aiding farmers in the U.S. to develop new sources of income and craft new educational programs to allow farmers to enter other sectors. Lowering or eliminating subsidies in the U.S. would require a reconfiguration of the economy so that the U.S. will specialize in producing goods for which it has a comparative advantage.
If the U.S. government is to
If the U.S. government is to address the issue of subsidies, it must create strategies for aiding farmers in the U.S. to develop new sources of income and craft new educational programs to allow farmers to enter other sectors. Lowering or eliminating subsidies in the U.S. would require a reconfiguration of the economy so that the U.S. will specialize in producing goods for which it has a comparative advantage. http://methoo.com
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