By helping West Africa's cotton sector, is the EU helping West Africa?

From the European Union:

The cotton sector in Benin, Chad, Burkina Faso and Mali employs around 2 million workers. This means that in these countries about 15 million people depend on cotton production and export for their living.

In the major cotton producing African states, cotton accounts for between 50 and 80 percent of exports. Any downward pressure on cotton prices puts these people at serious risk. The subsidisation of cotton exports by developed countries has a disastrous effect on prices for these countries, and that is why the EU has called for the elimination of all forms of exports refunds for cotton.

The EU has led the way in reforming its domestic policies on cotton. EU cotton subsidies have no distorting effect on the international market, and the EU pays no export subsidies for cotton. Under the Everything But Arms system all African cotton producers have tariff and quota free access to the EU market.

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For the implementation of the EU-Africa Partnership on Cotton, the EU has made available substantial financial assistance. More than € 260 million has been allocated to cotton programmes and projects since 2004. This has been a substantial and major source of support that can be used in mitigating negative effects of the fall in cotton prices on the macro-economies of the countries concerned. This total amount is by far the most important contribution to cotton by any development partner.

I hate to be a pessimist, but cotton will never be the goose that laid the golden egg for West Africa. When cotton subsidies in the United States finally do go down, there is no guarantee that prices will increase enough to pay off for the millions of African farmers hoping to make a killing from cotton. The question to ask is if prices do increase, how much will these farmers see? West African cotton companies are still too bankrupt and too corrupt to allow higher prices to trickle down. High oil prices worldwide guarantees that the cost of petroleum-based inputs – fertilizer and insecticides – will remain high, further cutting into farmers' profits. Cheaper synthetic fibers will also dampen cotton demand, especially if prices do increase.

Let’s say that West African farmers do make a (relative) killing in post-subsidy cotton. The logical thing will be that more people will jump at the chance to grow the crop. They’ll ignore food staples and will put great harm on the already weak soil of the Sahel, which is an ignored by-product of West Africa’s dependence on cotton. As the quantity of West African cotton rises, its quality – once quite high, now so-so – will again drop: they’ll be less time and less people around to do the important cleaning by hand that once made cotton from this area extremely sought after. Lower quality cotton translates into lower world prices. (One way to increase the number of hands at harvest time is to pull the kids out of school. I think we understand the long-term effects of that.)

If the European Union wanted to help African cotton farmers, it should do so by finding them alternative crops to enrich themselves. Small fields of high-priced, high-quality organic grown cotton may do the trick for some. But not too many. How about a regional market for foodstuffs like maize, sorghum and the fruits and vegetables Africans cultivate? This would especially be important as food prices promise to remain in the stratosphere for at least the short-term. Growing cotton should never be a priority in a region where millions of farmers work hard, but still cannot feed their own people.