WTO allows Brazil to retaliate in US cotton dispute
Wednesday, 2 September 2009
GENEVA, Sept 1 (AFP): The World Trade Organisation yesterday authorised Brazil to impose massive retaliatory sanctions against the United States in a dispute over US cotton subsidies.
The level of sanctions is expected to reach 800 million dollars (557 million euros) for this year, the country's ambassador to the WTO, Roberto Azevedo, told journalists after the global trade watchdog released its ruling.
The WTO said that Brazil could seek to "suspend concessions or other obligations" on US trade equivalent to up to 147.3 million dollars (103 million euros) a year due to subsidies that dampened international cotton prices.
In addition, it said it would allow sanctions, in an annual amount to be determined according to a specific mathematical equation, for US cotton subsidies that breached trade rules. This portion was calculated at 147.4 million dollars for 2006 by the WTO.
The sanctions can be applied until the US drops the subsidies, diplomats said.
Brazil, which first brought the case to the trade bloc in 2002, had sought 2.5 billion dollars (2.0 billion euros) from the United States.
Azevedo explained that some of the sanctions can only be applied to goods while others can, to a limited extent, target intellectual property and services.
"We ... find that it is regrettable that the United States has not yet complied with the determination of the multilateral trading system after the US subsidies have been condemned several times," he said.
The level of sanctions is expected to reach 800 million dollars (557 million euros) for this year, the country's ambassador to the WTO, Roberto Azevedo, told journalists after the global trade watchdog released its ruling.
The WTO said that Brazil could seek to "suspend concessions or other obligations" on US trade equivalent to up to 147.3 million dollars (103 million euros) a year due to subsidies that dampened international cotton prices.
In addition, it said it would allow sanctions, in an annual amount to be determined according to a specific mathematical equation, for US cotton subsidies that breached trade rules. This portion was calculated at 147.4 million dollars for 2006 by the WTO.
The sanctions can be applied until the US drops the subsidies, diplomats said.
Brazil, which first brought the case to the trade bloc in 2002, had sought 2.5 billion dollars (2.0 billion euros) from the United States.
Azevedo explained that some of the sanctions can only be applied to goods while others can, to a limited extent, target intellectual property and services.
"We ... find that it is regrettable that the United States has not yet complied with the determination of the multilateral trading system after the US subsidies have been condemned several times," he said.