Sweet revenge

[Weneedchange]

:lol: Finally some good news on the trade front...

 

All Financial Times News

An influx of cheap subsidised cotton from the US has impeded the growth of the cotton industry in China, the world's biggest producer and importer of the crop, possibly stalling development of the country's rural areas, Oxfam in Hong Kong claimed on Tuesday.

The development and relief group said heavy US cotton subsidies, worth about $3bn (€2.5bn, £1.7bn) a year, would cost China $208m in income and 720,000 jobs this year.

"Although the Chinese textile sector is booming, imports of highly subsidised US cotton threaten to exclude millions of Chinese farmers from the market," Oxfam said after carrying out research in Gansu and Xinjiang, two of China's poorest regions.

The Oxfam report comes a week before the World Trade Organisation ministerial meeting in Hong Kong seeks to make progress in global trade liberalisation talks.

Chong Chan-yau, executive director of Oxfam Hong Kong, urged developed countries to scrap all cotton export support by 2010.

"A lot of Chinese farmers have their livelihoods at stake already. The US should stop dumping cotton in China," Mr Chong said.

Cotton is the second most important cash crop in China after oil seeds because of its high return. It is also the most labour-intensive agricultural product, emp-loying about 46.2m people.

But since China joined the WTO in 2001, the volume of imported cotton from the US has surged 21 times in four years, crowding out local production. Conversely, a surge in Chinese textile exports – some manufactured with imported US cotton – has triggered temporary US and European curbs.

According to Oxfam, sales of cotton from the US to China rose from 48,000 tonnes in 2001 to 1.06m tonnes in 2004.

This year, imports are expected to surge to a record 3m tonnes, almost half China's production of 6.3m tonnes in 2004.

The US Congress is moving close to eliminating the Step 2 programme, which pays US millers a subsidy to buy domestic rather than imported cotton, and to reforming its export credit guarantee programme, both deemed illegal export subsidies by the WTO.

It is estimated this will reduce US cotton exports by about 2.5 per cent a year,and boost world prices slightly. The US has linked any reform of separate domestic subsidies for cotton to a wider deal in the global trade talks.

Copyright 2005 Financial Times

[No1Eman]

Yea, I was reading about this stuff in the financial times a couple of weeks ago. Apparently, the US is trying to leverage cotton, and other farm subsidies to try to pressure the Chinese to allow the world market to value their money. Right now, their government controls how much their money is worth, and that is one of the reasons why the people there earn such a small amount, and keeps their labor really cheap when compared to everyone else. Their money is worth about 25-30 % less than it should be based on the growth of their economy. If they revalued their money, it would help level the playing field, they would be close to Mexico in terms of wages, and costs...

[692yeehaw]

Yea, I was reading about this stuff in the financial times a couple of weeks ago. Apparently, the US is trying to leverage cotton, and other farm subsidies to try to pressure the Chinese to allow the world market to value their money. Right now, their government controls how much their money is worth, and that is one of the reasons why the people there earn such a small amount, and keeps their labor really cheap when compared to everyone else. Their money is worth about 25-30 % less than it should be based on the growth of their economy. If they revalued their money, it would help level the playing field, they would be close to Mexico in terms of wages, and costs...

And 0 labor costs combined with tariff-free imports at the loading dock send guys like us packing.

If everyone in America decided one day to just not work, we could break corporations. It would be nice to knock these fuckers down a level.