Tuesday, November 16, 2010

White Gold

Mali is a country so impoverished it is ranked 160th out of 169th in the United Nations Human Development Index. Life expectancy here is just 49.
Mali depends on cotton for its survival. Half of its export revenues come from cotton – it is the second-largest producer in Africa after Egypt – and it is estimated that more than 3.2 million Malians, 40% of the country's rural population, depend on the crop for their livelihoods.

Despite the fact that cotton prices are running at a 15-year high after crops in China and Pakistan were hit by floods earlier this year they are victims of an iniquitous global trading system. In the United States, the scale of government support to 25,000 cotton farmers has thrown the international trading system out of kilter. The political lobby for cotton is one of the strongest in US agriculture. in 2008/2009, cotton producers were awarded $3.1bn (£1.9bn) in subsidies, which, astonishingly, exceeded the market price by around 30%. The EU and China award its farmers similar grants, albeit on a lesser scale.The result has been overproduction, the rise of fast, disposable fashion and the artificial lowering of world cotton prices. The consequences are felt most deleteriously by the poorest farmers at the end of the supply chain. The price of west African cotton has fallen every year since 2003 and despite the recent spike in prices, there has been a long-term decline in real terms since the 1950s.

The American economy does not rely on cotton to anything like the same extent. In Mali, cotton is such a valuable commodity it is known as "white gold". According to Vince Cable, the UK business secretary, the elimination of global subsidies would raise cotton farmers' incomes in sub-Saharan Africa by 30%.


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