June 17, 1999

National Cotton Council Director Allen Helms, Jr., says the U.S. industry is competing in an international trade arena "rife with domestic and trade policy distortions." Some fundamental goals must be achieved in the upcoming international trade talks if the new round is to be of any significant benefit.

"The round of negotiations must level the playing field and make all countries abide by the same rules with respect to subsidies and other policy distortions," he told officials of the U.S. trade representative's office at a meeting in Memphis, TN, Wednesday. The U.S. textile industry is under siege from a flood of cheap cotton textile imports, mostly from Asia, he added.

"Whereas some Asian textile industries were only 20% export-driven pre-Asian financial crisis, many are now exporting upwards of 80% of their textile production," he said. "I urge you to keep in mind the industrial nature of our product and its close link to textile manufacturing...U.S. cotton's trading environment is shaped not only by our competitors' agricultural policies but their textile and apparel policies."

He also urged U.S. negotiators to continue to push for an increased market share for U.S. raw cotton and cotton products and an end to non-tariff trade barriers such as "unreasonable, non-science-based rules governing genetically modified organisms."

The NCC believes there is "much room for improvement" in limiting government support for agriculture and supports strong rules restricting the use of export subsidies and more rigid application of those rules for developing countries.

"Until such reductions are achieved, however, the U.S. must preserve important export programs in order to compete with the treasuries of our competitors," he added. "We urge continued support" for export credit guarantees and the Market Access Program. These programs "are not trade distorting and fully comply with WTO (World Trade Organization) principles."

Helms also urged that Congress restore full funding for cotton's Step 2 program.