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February, 2009
Source:
ICAC
by Célestin T. Tiendrébéogo
Director-General, Sotifex (Textile Fiber Company of Burkina
Faso)
The Sixth Open Session
during the 67th Plenary Meeting of the ICAC on November
17-21, 2008 in Ouagadougou was held on the topic of
“Competitiveness of African Cotton Production”. Speakers and
delegates from Chad, Zimbabwe, China (Taiwan), Cote
d'Ivoire, Brazil, Sudan, Egypt and the World Bank
participated in the discussion. The 6th Annual Congress of
the African Cotton Association (ACA) was held earlier this
year, during March 13-15, 2008 in Lusaka, Zambia. Speakers
from Benin, Burkina Faso, Cameroon, Chad, Mali, Mozambique,
Senegal, Tanzania, Zambia, and Zimbabwe participated in that
discussion comparing various forms of regulation and
organization of cotton production in African countries, and
pointing to advantages and weaknesses of some production
systems that affect the competitiveness of African cotton.
Cotton is an engine of economic
development in Africa, where an estimated 20 million people
depend on it for most of their annual income. African cotton is
of excellent quality, hand picked, and rain fed. However,
negative
factors affecting cotton production in Africa and causing
decreasing output and competitiveness include the low
market prices prevailing recently, the unfavorable exchange rate
of the U.S. dollar in relation to the euro, difficulties in
obtaining production financing and rising costs of inputs. In
addition the recent financial crisis is destabilizing producers,
traders and bankers leaving much uncertainty. Longer-term
reasons for declining competitiveness of African cotton
production include low or stagnant farm level productivity and
systematic inefficiency.
The Sixth Open Session during the 67th Plenary Meeting of the
ICAC in Ouagadougou discussed the topic of
“Competitiveness of African Cotton Production”. From political,
agronomic, industrial and commercial points
of view, African cotton industries must set realistic goals,
mobilize necessary technical and financial resources,
combat direct subsidies to production provided in other
countries, improve research, training, yields, quality of
seeds and fiber, improve the provision of inputs, financing,
transfer of technology, and logistics, reduce contamination, and
achieve wider use of high volume instruments (HVI). It is also
necessary to promote African cotton, and ensure the sanctity of
contracts in order to improve marketing.
In liberalized cotton economies in Africa, the lack of
regulatory frameworks has led to reduced quality and
disruptions in agronomy, ginning, shipping, and increased
contamination. Meeting participants called for faster
transfer of Bt technology in Africa, increased funding for
research and development and wider use of drought
tolerant, disease resistant varieties to improve productivity.
The need to improve market access, infrastructure and roads was
highlighted. Any liberalization should take into account lessons
already learned in Burkina Faso,
Tanzania, Uganda and Zimbabwe. There was a consensus that
volumes of production and profitability of producers should be
used as major criteria in measuring the success of reforms in
the sector. A regulatory framework should be prepared before
reforms are launched, while liberalization should be implemented
gradually, taking into account the interests of all market
participants and assuring a stable flow of investments, input
credit and extension services.
For successful, competitive cotton production, strong adherence
by producers and ginners to a well-defined set of
rules is needed, and governments must provide legislation in a
liberalized environment to protect investors’ and farmers’
interests. Strong measures to prevent side-selling by cotton
farmers without repaying input credits are needed. Strong
industry organizations for both cotton ginners and cotton
farmers could play an important role, and governments should
provide legislative and regulatory support to selfregulation of
industry organizations.
The achievement of these conditions, adjusted for specific
situations in each country, will lead to higher competitiveness
of African cotton in international markets. The ICAC will
continue a constructive discussion in international forums of
privatization/liberalization strategies in Africa, and other
aspects of improving competitiveness and the sustainability of
profitable cotton production in Africa. |
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