Case Study 3 — Cotton and the LDCs: The Litmus Test?

Abstract

The puzzle which this chapter investigates is how a group of the smallest and weakest states in the international system have managed to influence the negotiating agenda of an international organization in which economic power is traditionally seen as the deciding factor in negotiating outcomes.¹ The chapter looks at the special treatment that LDCs have had in the Doha Round negotiations via the case study of cotton. The case of cotton provides an example of the LDCs having a direct impact on the negotiating agenda of the Round. The chapter argues that the solution to the puzzle is the existence of the norm of special treatment for LDCs and the use of appeals to the norm by the LDCs involved in cotton. The cotton case shows that the LDCs were originally asking for fair treatment in accordance with WTO rules and special treatment in the form of compensation for their loss of earnings until the cotton subsidies were removed. However, the result of the LDCs’ activism has been special treatment as opposed to fair treatment. The case also demonstrates the inconsistency of the behaviour of developed countries, particularly the United States, which undermine their development policies through the use of agricultural subsidies. NGOs and trade bodies have also highlighted this inconsistency with the norm. Oxfam raised the issue in 2002 arguing that the cotton subsidies were undermining the HIPC Initiative while the World Bank drew further attention to the policy incoherence (Oxfam, 2002: 3; Baffes, 2003).