American cotton subsidies, which have been part of US legislation since 1934, are actually scheduled to increase in the new Farm Bill. For that reason, ambassador Azevedo expressed concern, calling the situation “uneasy.” He said there was no convincing justification for American congressmen to have approved a bill that was even more harmful to Brazilian cotton growers than the former bill.
“Farming should be based on market forces, not government subsidies,” said Azevedo, as he pointed out that the new Farm Bill “distorts market competition.”
The ambassador reported that Brazil and the United States have been discussing the cotton subsidy controversy and the new Farm Bill in an effort to avoid Brazilian retaliation under provisions of a direct compensation ruling (that allows cross retaliation) by the WTO dispute settlement panel in 2004.
At the same time, under a framework agreement, the United States has been making monthly payments of $12.275 million to the Brazilian Cotton Institute (“IBA”), as part of reparation payments to Brazilian cotton growers for losses due to US subsidies.
Allen Bennett – translator/editor The News in English
Link - Brasil pode retaliar Estados Unidos por causa de política de subsídios a produtores de algodão, diz embaixador