UPDATE ON THE EUROPEAN UNION AFRICA PARTNERSHIP ON COTTON

Transcription

1 Orientation and Monitoring Committee of the EU-Africa partnership on cotton European Union ACP Group of States UPDATE ON THE EUROPEAN UNION AFRICA PARTNERSHIP ON COTTON JANUARY 2017

2 TABLE OF CONTENTS INTRODUCTION THE INTRA-ACP COTTON PROGRAMME THE SITUATION ON THE COTTON WORLD MARKET INTERNATIONAL PRICES: FIBRE, COMPETITION FROM POLYESTER, AND COTTONSEED OIL PRODUCTION AND YIELD TRENDS IN DEMAND AND TRADE TREND IN AFRICAN COTTON VALUE CHAINS CRISES FINANCIAL CRISES AND THE EFFECTS OF USD/FCFA EXCHANGE RATES ON COTTON EXPORTED IN THE AFRICAN CFA ZONE PRODUCER PRICES AND INCOMES TRENDS IN COTTON FIBRE PRODUCTION TRENDS IN HARVESTED COTTON FIELDS TRENDS IN YIELDS AFRICAN COTTON FIBRE EXPORT TREND TRENDS IN THE USE OF COTTON FIBRE IN AFRICA DEVELOPMENTS IN WTO TRADE NEGOCIATIONS HONG-KONG, BALI AND NAIROBI POST-NAIROBI LATEST ESTIMATES OF GOVERNMENTAL AID TO COTTON VALUE CHAINS IMPLEMENTING THE DEVELOPMENT COMPONENT OF THE EU-AFRICA PARTNERSHIP ON COTTON VIA COOPERATION INITIATIVES OPENING REMARKS THE WTO DIRECTOR-GENERAL'S CONSULTATIVE FRAMEWORK MECHANISM ON COTTON OVERVIEW OF FUNDING TO THE COTTON SECTOR IN AFRICA CURRENT KEY AID TO AFRICAN COTTON, FUNDED BY THE EU (EC AND EUD OF THE MEMBER STATES) Opening remarks The Support Programme for the Consolidation of the Action Framework under the EU-Africa Partnership on Cotton (Intra-ACP Cotton Programme) Improvements in incomes and food security of producers through diversified organic production systems (SYPROBIO) Support to the cotton sector recovery plan Côte d Ivoire Aid to increase the incomes of small cotton producers thanks to improved quality and market access Tanzania West African Organic and Fair-Trade Cotton Project Project to strengthen governance and improve the productivity and sustainability of farms in Mali Projects under development involving the Malian cotton sector Support to producers and producer associations, including in the cotton areas Benin Support for increased security and integrated management of agro-pastoral resources (ASGIRAP) with a specific component for improving productivity in the cotton sector Cameroon Support to the cotton sector (road maintenance, animal traction farming, counselling producers, strengthening cooperatives and support to inter-professionals) Côte d Ivoire Competitive African Cotton Initiative (COMPACI) Promotion of cotton production in sub- Saharan Africa: Cotton made in Africa (CmiA) Phase II Better Cotton Initiative (BCI) CURRENT KEY SUPPORT TO THE AFRICAN COTTON SECTOR, FINANCED BY OTHER ACTORS Cotton Partnership Programme C4-CP RECOLTE project for the improvement of the organic cotton value chain Burkina Faso Programme to develop the cotton value chain in Africa P a g e

3 Technical assistance programme of China C4 countries Technical assistance programme of India - C4 countries Developing a national system to classify cotton in Kenya and Mozambique The Procoton programme: improving productivity and marketing by supporting producer associations Integrated Regional Cotton Plant Protection Programme in Africa (PR-PICA) TRENDS IN THE COORDINATION AND COMMUNICATION OF COTTON PARTNERSHIPS AND ECOSYSTEMS 57 APPENDIX COTTON FIBRE PRODUCTION (IN THOUSANDS OF TONS) AREA OF HARVESTED COTTONSEED (IN THOUSANDS OF HECTARES) YIELDS: KG OF FIBRE/ HECTARE COTTON FIBRE CONSUMPTION (THOUSANDS OF TONS) COTTON FIBRE EXPORTS (THOUSANDS OF TONS) APPENDIX CURRENT OR FUTURE SUPPORT ACTIONS SPECIFIC TO AFRICAN COTTON: NOVEMBER 2016 "COS-COTTON" UPDATE PAST SUPPORT ACTIONS SPECIFIC TO AFRICAN COTTON: NOVEMBER 2016 "COS-COTTON" UPDATE ALLOCATIONS FROM THE SUPPORT PROGRAMME FOR THE CONSOLIDATION OF THE ACTION FRAMEWORK FOR THE EU- AFRICA PARTNERSHIP ON COTTON P a g e

4 LIST OF FIGURES Figure 1: Evolution, from October 1991 to October 2016, of cotton prices based on the Cotlook A index USDc/kg Figure 2: Monthly trend for cotton* and cottonseed oil** prices, from January 2006 to September Figure 3: Evolution from October 1990 to November 2016 of cotton prices based on the Cotlook A index expressed in USDc/kg and FCFA/kg Figure 4: Trends in cotton fibre production in Africa compared with the world production from 1999/00 to 2016/17 (in thousands of tons) Figure 5: Trends in cotton fibre production in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of tons) Figure 6: Trends in the harvested cotton fields in Africa compared with the world production surfaces from 1999/00 to 2016/17 (in thousands of hectares) Figure 7: Trends in harvested cotton area in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of hectares) Figure 8 : Trends in average cotton fibre yield in Africa compared with average global yields from1999/00 to 2016/17 (cotton fibre kg/ha) Figure 9: Trends in cotton fibre production in Africa compared with world exports from 1999/00 to 2016/17 (in thousands of tons) Figure 10: Trends in cotton fibre production in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of tons) Figure 11: Trends in the use of cotton fibre in Africa compared with world consumption from 1999/00 to 2016/17 (in thousands of tons) Figure 12: Trends in the use of cotton fibre in the key African regional economic communities from 1990/00 to 2016/17 (in thousands of tons) Figure 13: Distribution of funding for current or future projects/programmes specific to African cotton, in millions of euros and percentage points, November Figure 14: Distribution of funding for past projects/programmes specific to African cotton, in millions of euros and percentage points, November Figure 15: Distribution of funding for past, current and future projects/programmes specific to African cotton, in millions of euros and percentage points, November LIST OF TABLES Table 1: Averages of monthly Cotlook A rates in USDc/lb (USDc/kg) Table 2: Numbers and benchmarks regarding cotton fibre and polyester Table 3: Trend in prices*1 for first choice cottonseed from 2004 to 2016 (FCFA/kg) P a g e

5 ACRONYMS (A)PO AAACP ACA ACP ACTIF AFCOT AFD AfDB AIC AICB AOC AU AUC AProCA BCI BMZ C2D C4 (Agricultural) Professional Organization All ACP Agricultural Commodities Programme (Programme for all ACP States relative to the Basic Agricultural products) African Cotton Association African, Caribbean and Pacific Group of States African Cotton & Textile Industries Federation French Cotton Association (Association Française Cotonnière) Agence Française de Développement African Development Bank Interprofessional Cotton Association Benin (Association Interprofessionnelle du Coton) Interprofessional Cotton Association of Burkina Faso West and Central Africa African Union African Union Commission Association of African Cotton Producers Better Cotton Initiative German economic co-operation Debt Reduction and Development Contract (Contrat de Désendettement et de Développement) Cotton Initiative Group: Benin, Burkina Faso, Mali and Chad C4-CP USAID C4 Cotton Partnership Project ( ) CAADP/ PDDAA Comprehensive Africa Agriculture Development Programme/ Programme Détaillé de Développement de l Agriculture Africaine CFC CIRAD CMDT CmiA COMPACI COMESA Common Fund for Commodities French agricultural research centre for international development (Centre de coopération internationale en recherche agronomique pour le développement) Mali Company for the Development of Textiles (Compagnie malienne pour le développement du textile) Cotton made in Africa Competitive African Cotton Initiative Common Market for Eastern and Southern Africa 5 P a g e

6 COMPACI COS-cotton CTA DGCFMC EC ECCAS ECOWAS EDF ESA EU EUD FAO FFS FiBL FOB FSP FSTP ICAC/CCIC IER IFDC INERA IPPM ITC/CCI LDCs MARI MoZaZiMa NAFSIP NEPAD Competitive African Cotton Initiative Orientation and Monitoring Committee of the EU-Africa partnership on cotton Technical Centre for Agricultural and Rural Cooperation ACP-EU WTO Director-General s Consultative Framework Mechanism on Cotton European Commission Economic Community of Central African States Economic Community of West African States European Development Fund East and Southern Africa European Union European Union Delegation Food and Agricultural Organization Farmer Field Schools Research Institute of Organic Agriculture Free On Board Priority Solidarity Fund (Fonds de Solidarité Prioritaire) Food Security Thematic Programme International Cotton Advisory Committee/ Comité Consultatif International du Coton Institute of Rural Economy (Institut d Économie Rurale) (Mali) International Center for Soil Fertility and Agriculture Development National Institute of Environment and Agricultural Research (Institut National de l Environnement et des Recherches Agricoles) (Burkina Faso) Integrated Production and Pest Management International Trade Centre / Centre du Commerce International Least Developed Countries Margin After Reimbursement of Inputs Mozambique, Zambia, Zimbabwe, Malawi (regional cooperation for the cotton value chains) National Agricultural and Food Security Investment Plan New Partnership for Africa s Development NEPAD Agency NEPAD Planning and Coordinating Agency NCFP National Cotton Focal Points 6 P a g e

7 OCI PACRM PADYP PAFICOT PASE PMU PRCC PROCOTON PR-PICA RAFSIP RCFP REC RIP SADC SC SODECOTON SYPROBIO UEMOA UNCTAD USAID USDA WACIP WB WTO Organization of Islamic Cooperation Pan African Cotton Road Map Support programme to production dynamics in cotton areas (Programme d appui aux dynamiques productives en zones cotonnières) (AFD/Benin) Support project to the cotton sector in the four countries of the sectoral initiative in favour of cotton (AfDB/UEMOA) Project to strengthen governance in the cotton sector within the framework of the institutional reform and to improve the productivity and sustainability of farms (Projet de renforcement de la gouvernance de la filière coton dans le cadre de la réforme institutionnelle, et d amélioration de la productivité et durabilité des exploitations) (Mali/AFD) Programme Management Unit Sub-regional support project for the development of fair trade and organic cotton in West and Central Africa (Projet sous-régional d appui au développement du coton équitable et bio-équitable en Afrique de l Ouest et du Centre) Programme for Capacity Building of Cotton Producer Organizations (Benin) Integrated Regional Cotton Plant Protection Programme in Africa (Programme régional de protection intégrée du cotonnier en Afrique) Regional Agricultural and Food Security Investment Plan Regional Cotton Focal Point Regional Economic Community Regional Indicative Programme Southern African Development Community Steering Committee Société de développement du coton SYstèmes de PROduction BIOlogique West African Economic and Monetary Union (Union Économique et Monétaire Ouest Africaine) United Nations Conference on Trade and Development US Agency for International Development United States Department of Agriculture West Africa Cotton Improvement Program World Bank World Trade Organization 7 P a g e

8 INTRODUCTION The EU-Africa Partnership on cotton, which celebrated its 12-year anniversary, is a long-term partnership between the ACP Group of States and the EU and its aim is to tackle the major challenges facing African cotton value chains. It has its place first of all because of the major socio-economic importance that cotton value chains hold for many African cotton-producing countries on the macroeconomic (export earnings, new jobs, infrastructures, etc.), mesoeconomic (evolution of value chains and local development) and microeconomic levels (development of cotton farms, which are essentially family-run). For family-run businesses producing cotton in a sustainable and profitable way is an essential part of being viable and capable to move towards increasingly progressive modernisation strategies which contribute to fighting poverty effectively. African cotton value chains must continue to face their many challenges, which are both external (subsidies/ the Doha-WTO issues, significant volatility of the prices of cotton around the world, exchange rates, harsh international competition) but also internal to the value chains. Indeed, to better resist external shocks (resilience) it is essential to define and implement responsive and adaptive strategies within cotton value chains, in particular in terms of improving management/organization, competitiveness and the added value generated. The Partnership was set up between the EU and the African countries in July 2004 (Paris Forum) and resulted in the adoption of a joint Action Plan which evolved into an Action Framework 1 in February 2010, following a mid-term evaluation of the Partnership (June 2009). The Action Framework confirms the relevance of the EU-Africa Partnership on cotton and the need for it to continue while adapting to the current situation. It deals with the two components of the Partnership which are Trade and Development. The Action Framework is both a strategic reference document in which regional cotton strategies are set out and a tool to monitor the actions carried out within the framework of the EU-Africa Partnership on cotton and supervise all forms of support provided specifically to the African cotton sector. It is regularly updated 2 with information gathered from the various donors, the African regional integration organisations and the interprofessional organisations that work in African cotton value chains. The overall objective of the Action Framework is to support African cotton value chains so that they can in turn contribute to develop agriculture and fight poverty. The specific objective is to increase the competitiveness, added value and sustainability of African cotton value chains by reducing the impact on producers' incomes. 1 French Version: English Version: 2 Latest revised version (French): Latest revised version (English) : 8 P a g e

9 The Action Framework comprises six strategic points, defined on the basis of the issues and challenges that need to be addressed according to the stakeholders of African cotton value chains: (1) Improve the ability to design, follow, assess and update national and regional cotton strategies; (2) Improve the institutional background of cotton value chains, their organization and efficiency; (3) Increase the competitiveness of African cotton value chains, by way of 2 sub-points: 3A Improve external factors of competitiveness in cotton value chains (Trade component /WTO-DOHA) and 3B Improve internal factors of competitiveness in cotton value chains (which is part of the Development component together with points 1 to 6); (4) Make cotton value chains less vulnerable; (5) Increase the added value generated by cotton value chains; (6) Coordinate more efficiently and effectively on an international, regional and national level. All past (since 2004), present and planned aid specific to African cotton is classified according to these strategic points and updated during the Action Framework's regular reviews. Following the Paris Forum of July 2004, an ACP-UE Orientation and Monitoring Committee on cotton (COS-cotton) was created in order to monitor in particular the development component of the Action Framework, while still taking account of the progress in the trade component. Its primary tasks are to ensure that funds are used coherently, to follow and encourage the implementation of planned actions and coordinate and disseminate available information on a given topic. Since April 2012, COS-cotton is chaired by the Ambassador of Benin, HE Charles Borromée TODJINOU. As his appointment as ambassador is coming to an end, a new COS-cotton president will soon be named. COS-cotton consists of a committee of experts made up of various categories of stakeholders who have expanded as the Partnership develops. They are currently represented by the following full members and observer members: Full members: The ACP Secretariat, on behalf of the ACP Group of States; The EU, represented by EC/DEVCO and France, representing the Member States; The C4 The African Union Commission (AUC) Regional integration organizations represented by UEMOA, ECCAS and COMESA; The private sector: AProCA for producers, A.C.A for ginners and ACTIF for companies that process fibre locally; The ACP-EU Technical Centre for Agricultural and Rural Cooperation (CTA). 9 P a g e

10 Observer members: The MoZaZiMa public-private forum representing cotton value chains of Mozambique, Zambia, Zimbabwe and Malawi; The UNCTAD, to accompany the process of finalization by the Pan African Cotton Road Map (PACRM). This document partially satisfies the need to share information with a larger audience, but does not claim to cover all the aspects of the Partnership extensively. The previous update on the EU-Africa Partnership on cotton dates back to December Starting from January 2016, this update highlights the facts and major events in the trend in the Partnership and the various undertakings to support of African cotton. To this end, the report contains the following presentations: Overview of the current cotton programme of the Partnership (Chapter 1). The major changes in cotton value chains on the international scene and the main African cotton value chains (Chapters 2 and 3) The trend in the trade component under the EU-Africa Partnership on cotton (Chapter 4). The implementation of the development component under the Partnership which describes, in addition to the current Programme, the other main forms of support to the cotton sector in Africa provided by EU member States and other donors (chapter 5). Lastly, the main coordination and communication activities carried out or supported by COS-cotton (chapter 6). 3 The report, in French and English, is available for consultation at this website: French version English Version: 10 P a g e

11 1.THE INTRA-ACP COTTON PROGRAMME The Support Programme to consolidate the Action Framework under the EU-Africa Partnership on cotton, hereafter referred to as the Intra-ACP Cotton Programme, is implemented under the contracting authority of the Secretariat of the ACP Group of States to programme intra-acp activities as per the 10 th EDF. It has a total budget of 11m for the period and builds on the cotton component of the AAACP Programme. The cotton component of the AAACP Programme was the first intra-acp specific programme to be directly linked to the EU-Africa Partnership on cotton 4. A synthesis report 5 on the cotton component under the AAACP Programme lists the activities that were implemented and highlights key results and lessons learned. The Intra-ACP Cotton Programme still seeks to reach the goal established under the EU-Africa Partnership on cotton, which is the sustainable improvement of competitiveness, added value and sustainability of African cotton value chains, so as to optimise its impact on producers' incomes. Coherently with the former programme, it seeks to support long-term structuring actions which capitalise on results obtained in connection with the key points of the Action Framework of the Partnership and with the three regional strategies for the cotton-textile-clothing sector 6 around which they revolve. The ITC and FAO, who were heavily involved in the implementation of the former programme, during which they proved their knowhow, have been reappointed as implementing agencies. The current programme comprises the following components: An overall technical coordination, a monitoring of cotton policies and communication actions put in place by the Programme Management Unit (PMU) in close connection with the contracting authority of the Programme, namely, the Secretariat of the ACP Group of States. Projects implemented by FAO to spread good agricultural practices, in particular the Integrated Production and Pest Management (IPPM). Projects implemented by the International Trade Center (ITC/CCI) to make the regional cotton strategies operational, promote the quality of African cotton, open new markets and support local processing by introducing and spreading weaving technologies. The programme also gives stakeholders in the African cotton sector a chance to resort to 2 specific financial instruments: On the one hand, a Grants Facility (amounting to 1,500,000) makes it possible to call upon external support in order to implement complementary actions (projects) 4 In addition, it should be noted that since the beginning of the Partnership, many projects and programmes have been financed via delegations of EU and EU member States (see 5.4). 5 French Version: English version: 6 Developed during the implementation of the cotton component of the AAACP Programme 11 P a g e

12 which aim to improve domestic competitiveness and the sustainability of cotton value chains. Since the publication of a call for proposals on the European Union website in April 2014, the process has come into being with the signing of seven grant contracts in January 2015 (see for further information). Within the framework of the Cotton Facility, a short-term expertise is expected, which will be external to the PMU, in order to improve the skills of professional associations and actors in cotton value chains in terms of planning and monitoring/active participation in the implementation of strategies (short-term expertise days). This targets very specific activities (e.g. training, workshops, studies, etc.). An initial call for proposals was published in May 2014 on the ACP secretariat's website ( Six applications were deemed eligible through an assessment process. Five contracts were eventually signed, and their implementation planned from May 2016 to April 2017 (see for further information). A second call was set up in July Four applications were selected and their contracts signed. Their implementation is planned from May 2016 to March 2017 (see 5.4.2). In addition, it should be noted that the Cotton Facility includes 500 days of short-term expertise for activities in support of the PMU and to conduct work and research that is relevant to African cotton value chains. This refers notably to the work that is currently being carried out to finalise and adopt a Pan African Cotton Road Map (PACRM). Another short-term expertise was implemented on Progress and prospects of cotton research in Africa: diagnosis and proposal for a revitalization strategy (see 5.4.2). The process of the Pan African Cotton Road Map (PACRM) In addition to the technical support brought by the cotton component under the AAACP programme and the current intra-acp cotton programme, a process to make the coordination of activities in support of African cotton more coherent has been sustained by COS-cotton since 2011, in conjunction with UNCTAD. This process aims to develop a PACRM centred on the issues of 1) productivity, 2) market, commerce and marketing; and 3) added value in cotton value chains, which are in line with the strategic points of the Action Framework. The main purpose of the PACRM is to integrate the support provided to African cotton with African development policies and related funding tools. In practise, this means first and foremost integrating and aligning the aid to African cotton with the Comprehensive Africa Agriculture Development Programme (PDDAA/CAADP) which is applied on a regional level via the Regional Agricultural and Food Security Investment Plan (RAFSIP) and on a national level via the National Agricultural and Food Security Investment Plan (NAFSIP). The support provided by the current cotton programme has made it possible to finalise the technical work on the PACRM, the final document having been adopted during the 21 st COS- Cotton meeting (Brussels, October 27 th 2016) by all stakeholders (see for further information). 12 P a g e

13 2. THE SITUATION ON THE COTTON WORLD MARKET International Prices: Fibre, Competition from Polyester, and Cottonseed Oil Fibre Figure 1 shows the trend in cotton fibre prices around the world expressed by the Cotlook A index from October 1990 to November They are usually expressed in USDc/lb, but have been also converted into USDc/kg on the graph. The average monthly prices during the , decades and for the January 2010-June 2014 and July 2014-November 2016 periods are shown in table 1. This table also highlights the highest and lowest monthly prices for the periods under consideration. Table 1: Averages of monthly Cotlook A rates in USDc/lb (USDc/kg). 06/2014 Period / / /2016 Monthly average 73.0 (160.9) 59.2 (130.6) 99.2 (218,7) 72.2 (159.2) Coefficient of variation (%) Lowest monthly 52.8 (116.3) 37.2 (82.0) 67.4 (163.1) 65.5 (144.3) November October 2001 January 2015 March Highest monthly (255.4) 81.5 (179.8) (506.2) 83.8 (184.8) May 1995 March 2008 March 2011 July 2014 Source: historic data by the National Cotton Council and our calculations This table reflects the downward trend of cotton prices between the 1990s and 2000s. As for the majority of agricultural commodities, this evolution followed a long-term downward trend which was fuelled by various factors, such as the profits arising from increased productivity in the production chain (technological innovations and progress, a decrease in production and processing costs, etc.) but also by the sizeable grants provided by some producer countries to their agricultural production, including cotton (see 4.3). However, this long-term downward trend seems to have reversed towards the end of the 2000 decade, compounded by heightened price volatility. 7 The majority of the data are taken from ICAC/ CCIC, global statistic, October 2016 and Cotton this month, December P a g e

14 Indeed, beginning in April 2009, following a recovery in global demand against a reduction in supplies and stocks, prices started rising sharply, setting a spectacular and uninterrupted trend until March During this period, the Cotlook 8 A index increased by almost 350% and reached a monthly average of USDc/lb in March 2011, beating historical records on several occasions. With prices so high, the amount of cotton sold physically was very limited. During the period from January 2010 to June 2014, monthly average prices were of 99.2 USDc/lb, with relatively high volatility (33.8% coefficient of variation). For the next period, July 2014 to November 2016, the monthly average price went back down to 72.0 USDc/lb, with a 19% decrease over 4 months (from August to September 2014), and then remained relatively stable, with much less volatility (6.5% coefficient of variation). Even if it did not lead to a return to the low average prices of the decade, this downward pressure was largely fed by a very high level of Chinese stocks. The regulation of these stocks was accompanied by a substantial decrease in Chinese imports in 2014/2015 (- 41% compared to 2013/2014). This decrease continued and intensified in 2015/2016 (-47% compared to 2014/2015). It should begin to stabilise in 2016/2017. The latest ICAC projections 9 for the 2016/2017 period predict a median price of 74 USDc/lb for the Cotlook A Index, with an estimated range of 66 to 87 USDc/lb. The annual fluctuations of cotton prices can also be seen in figure 1, which shows the monthly prices for cotton fibre over the past 25 years based on the Cotlook A index. The regression line on the graph represents the trend of international cotton prices. The dramatic rise in prices recorded from April 2009 to March 2011 has had the effect of steepening the regression line which had previously been negative and reflected a sharp decline in prices in the long term.. 8 The Cotlook A Index is the index for mean international prices that is quoted more often. 9 ICAC Cotton this month, November P a g e

15 Figure 1: Evolution, from October 1991 to October 2016, of cotton prices based on the Cotlook A index USDc/kg Source: statistical data by the National Cotton Council and our calculations Competition from polyester 10 It is important to note that the use of cotton is following a clear downward trend compared to other world textile fibres and this trend is expected to continue in the long term. Between 1990 and 2015, this market segment has decreased, going from 49.1% to 27.6% 11. Historically, it reached 65% in Throughout this decade, the production of polyester fibre is likely to continue growing at higher average annual intervals than for other types of fibre. It is also worth noting that a period of low oil prices has prevailed for nearly two years, which is conducive to investments in polyester production, offering fewer opportunities for substituting cotton fibre. Some figures and benchmarks can be found in table 2. They highlight the major influence of China, which has become considerably stronger since its accession to the WTO (2001) and the end of the multi-fibre arrangement (2005). China s government policy and, to a lesser extent, that of other Asian countries, have strongly strengthened global spinning capacity from 2000 to Furthermore, China s management of the massive cotton fibre stocks which it built up over the past few years, has made administered prices within the domestic market far higher than those of the global market. Since 2011, cotton produced domestically in China has consequently cost the manufacturing sector about 59% more in China. In opposition to these excessive cotton prices, directly administered by China, excess polyester production capacity has exerted significant downward pressure on these prices. In 10 Source : ICAC (2016), Cotton : Review of the World Situation, Vol. 70, #1, September-October Which represented 78% of final consumption of globally produced natural fibre 15 P a g e

16 an industry which functions with very tight margins, this provides a strong financial incentive to substitute cotton with polyester. The position of Chinese cotton in the domestic market has also encouraged the emergence of the textile industry in countries such as Vietnam and Bangladesh, as well as the growth of India s textile industry, who have a comparative advantage over China as regards cotton textile production. Nevertheless, the significant increase in polyester textile and fibre production capacity, its excess polyester supply pushing prices downwards, its dominant presence in governmentcontrolled cotton production, along with administered prices which undermine the competitiveness of cotton, will continue to lower cotton consumption. The policies which have led to this state of affairs have not been seen as actionable by the WTO. Yet it will not be possible to reverse cotton s market share loss so long as these policies remain. Table 2: Numbers and benchmarks regarding cotton fibre and polyester Cotton fibre Polyester Evolution of global supply from 1990 to to 26 Mt (x 8.7 to 48.0 Mt (x 5.52) 1.44) Evolution of global polyester fibre production capacity ( ) Evolution of market share of global textile fibre consumption from 1990 to to 27.6% Evolution of polyester s global market share compared to all other synthetic fibres, from 1990 to to 69.4 Mt; China: 1.3 to 49.6 Mt 18.5 to 55.5% Other synthetic fibres: 22.4 to 16.9% 45 to 76.8% Evolution of global spinning capacity from 2000 to Grown four times as fast as global 2009 population China: +158%; rest of Asia: 22.6%; rest of the world: 28.1% End of the multi-fibre agreement (MFA), 2004 China enters into the WTO: 2001 Acceleration of China s dominant oligopoly Today, 86% of global spinning capacity is found in the Asian subcontinent Source: ICAC (2016) Cotton: Review of the World Situation, Vol. 70 #1 September-October P a g e

17 In order to attenuate the effects of these policies and thereby slow cotton s market shares loss relative to polyester, some actions are recommended: - Maintain competitive cotton prices. However, the margin is limited and there is a risk of causing the global cotton supply to fall. Nonetheless, the price gap between the two products should not be allowed to widen even more. This will demand sustained efforts from cotton producers and value chains in order to lower production costs and increase productivity. - Long-term investments in agricultural research and outreach are part of the solution, especially as there is a large margin for yield increases in Africa. - Continued research on ways to improve cotton s technical performance compared to competing fibres. The natural properties of cotton are very popular with consumers, but more investments should be made in research and development to improve its ease of use in industrial processes. - The cotton sector should do more to raise awareness of this fibre s benefits. Although it is often the target of unfair and unfounded attacks regarding its environmental impact, cotton guarantees the food security and income of hundreds of millions of people around the world. - Promotional campaigns can shape consumer preferences, build consumer loyalty and counter the drop in consumption. The need to raise consumer awareness of the benefits of cotton is of particular importance in emerging markets in Asia and Africa, where most of the coming decades population growth will take place. Consumers in these markets often know little about cotton and its benefits. Cottonseed oil Figure 2 shows the trend in the monthly average cotton prices based on the Cotlook A index, and the prices of cottonseed oil from January 2006 to October Although their evolution is more closely linked to the trend in food commodities and alternative oils such as imported palm oil, the figure shows that over the period in question international prices of cottonseed oil enjoyed two peaks: in 2008/09, during the food price crisis, and in May At the time of the cotton fibre price bubble in 2010/2011, cottonseed oil prices were relatively high. 17 P a g e

18 Figure 2: Monthly trend for cotton* and cottonseed oil** prices, from January 2006 to September 2016 Sources: Author, UNCTAD Statistics, and Cotton Outlook: Production and yield 12 After reaching a record 27 million tons of fibre in 2004/05, the world production of cotton declined to 22.3 million tons (-18%) in 2009/10. Reduced incomes in the cotton sector, higher prices for competing crops and the difficulties encountered in financing inputs led producers to grow less cotton. However, in response to the recovery of international cotton consumption recorded from 2009 to 2011 and to the sharp rise in fibre prices, the global production experienced a significant increase, reaching 27.8 million tons in 2011/12. From 2012/13 to 2014/15, world production remained at just over 26 million tons. In 2015/16, however, it decreased by about 20%, settling at 21 million tons, production thereby dipping below global consumption for the first time since 2010/2011, or five consecutive periods. It should be noted that the drop in Chinese production is even more pronounced in 2015/2016, falling by 27%. Among the major factors we find the beginning of a marked decline (-13%) of Chinese cotton fibre stocks starting in 2015/2016, whereas they had more than doubled during the five preceding years. In 2016/2017, global production should increase slightly (+7%) while remaining below global consumption. It should be remembered that India has held the lead in global cotton fibre production since 2014/2015, overtaking China, followed by the United States, Pakistan and Brazil. Concerning yields, it should be stressed that the world average yield, which was only 411 kg fibre/ha in 1980/81, went from 612 to 804 kg/ha (+31%) between 2000/2001 and 2013/ For more information, see appendix P a g e

19 In 2015/16, average global yields declined substantially (-14%) relative to the 2013/2014 yield of 692 kg/ha 13, but should recover to 755 kg/ha in 2016/2017. The average yield obviously masks important disparities, in particular between rainfed cotton and irrigated cotton 14, the latter yielding at least twice as much. In 2009/10, irrigated cotton accounted for approximately 63% of cotton fields around the world, that is to say 72% of the world cotton production. One of the factors that explain the rising trend in world output from 1997 is the fast development of genetically modified cotton, whose relative share of land went from 15% in 2000 to nearly 75% in Trends in demand and trade 16 Consumption The industrial use of cotton fibre expanded continually between 1998/99 and 2007/08, increasing by 8 million tons over this period and reaching 26.5 million tons in It dropped drastically in 2008/09 (-11%) and fell back to 23.8 million tons due to the slowdown in global economic growth, marking the most important drop since the Second World War. After recovering a few percentage points during the following two marketing years, it dropped again reaching 22.8 million tons in 2011/12 before gradually moving up again, reaching slightly more than 24 million tonnes starting in 2014/2015. It should be noted that the use of cotton fibre for industrial purposes is highly concentrated. In 2016/2017, the key consumer countries in descending order, China, India, Pakistan, Europe and Turkey, Bangladesh and Vietnam - will account for approximately 80% of the global demand. Exports During the 2000/01 to 2005/06 period, cotton fibre exports strongly increased in volume (+66%), a significantly higher figure compared with production (+32%), thus confirming the fact that cotton tends to be one of the most widely traded agricultural raw materials. After a peak in 2005/06 with 9.7 million tons of fibre exported, the amount of world exports fell back to 6.6 million tons (-32%) in 2008/09. It then grew again and reached 10 million tons in 2012/13 before declining thereafter. It should reach around 7,6 million tons in 2016/17. India is projected, for 2016/17, to be the second largest worldwide exporter (11%) after the USA (34%), then Brazil (10%), Australia (10%) and Uzbekistan (6%). 13 ICAC statistical data, October 2016 and Cotton this month, December Significant disparities may also exist depending on producer typology as related to rainfed production, in particular according to the farm s level of equipment. 15 Cellule de veille OGM (in French), April 2016, vol ICAC statistical data, October 2016 and Cotton this month, December P a g e

20 Imports After a fall of 22 percentage points in the world cotton trade in 2008/09, i.e. 6.6 million tons the lowest level in eight years world cotton fibre imports soared to 9.8 million tons (+50%) in 2011/12. The hefty recovery of Chinese imports between 2008/09 and 2011/12 stimulated the international trade of cotton fibre. Despite this, after 2011/12, Chinese imports have drastically been reduced because China is set to use a part of the vast amount of stocks it has amassed. Chinese reserves are estimated at 12.9 million tons at the end of 2014/15, which accounts for 173% of the Chinese industrial use in 2013/14 and 58% of world stocks 17. Projections for the 2014/15 marketing year point to a total exported volume of approximately 8 tons of fibre. Carryout Stocks At the end of the 2009/10 marketing year world stocks of cotton fibre reached their lowest in 25 years, i.e. 8.6 million tons. This exceptionally limited amount of stocks contributed to a peak in cotton prices in 2010, which lasted until March Since reaching their lowest, carryout stocks were regenerated considerably, particularly under China's impulse (see hereunder), reaching a record 22.3 million tons in 2014/15, before returning to a projected 17.4 million tons in 2016/ TREND IN AFRICAN COTTON VALUE CHAINS 3.1.Crises Financial crises and the effects of USD/FCFA exchange rates on cotton exported in the African CFA zone African cotton value chains, especially in the CFA Franc zone, were faced with a significant financial crisis from 2005 to 2010, whose effects can still be felt today. The crisis was particularly intense in the Franc zone, where several cotton companies had to recapitalise their equity under penalty of financial bankruptcy. Cotton value chains experienced a short-lived improvement in 2007/08 before being exposed to the effects of the financial and economic world crisis which began in August In addition, the first price bubble with which the cotton futures market was confronted in the first quarter of 2008 forced some traders to suffer considerable financial losses. By then, the international cotton market had become very challenging. Cotton prices, expressed in USD, had nevertheless recovered between 2005 and mid-2008, as was mostly the case for other agricultural commodities. However, the recovery hardly benefitted the countries in the CFA zone because of a continuous depreciation of the dollar during this period, against the Euro and the CFA Franc. Indeed, a long-lasting depreciation of 17 Source: ICAC Cotton this month, December P a g e

21 the dollar compared to the Euro/FCFA started in 2002 and reached a low ebb in July 2008 when the exchange rate was 416 FCFA to 1 USD, that is to say 45% less than at its highest peak in 2002 (1 USD = 759 FCFA in February 2002). From August 2008 to September 2014 the depreciation of the dollar slowed down somewhat and reached an average of 486 FCFA to 1 USD, bookending the period of significant global cotton price increases from April 2009 to March From October 2014 to November 2016, bolstered by an economic growth that clearly favoured the United States over the European Union, the value of the US dollar increased significantly, on average by about 20% compared to the Euro/CFA franc, with an average rate of 582 CFA francs for 1 USD during this period, counteracting a large proportion of the 25% decrease in cotton prices expressed in US dollars. It is however always very difficult to forecast the trend in exchange rates, in particular if a trend is set to continue for more than 12 months. The appreciation of the US dollar against the Euro/FCFA would be a positive factor for exporting agricultural commodities coming from the FCFA zone. The evolution of cotton fibre trends worldwide is presented in chapter 2.1. Figure 3 shows also this evolution, from October 1990 to November Cotton prices according to the Cotlook A index are expressed not only in USD cents/kg but also in CFA francs/kg. The trend in the USD/FCFA exchange rate is also shown. Figure 3: Evolution from October 1990 to November 2016 of cotton prices based on the Cotlook A index expressed in USDc/kg and FCFA/kg N.B.: 1 st January 1994, devaluation of the FCFA Source: statistical data by the National Cotton Council and our calculations 21 P a g e

22 3.2. Producer prices and incomes In East and Southern Africa, where cotton value chains are part of a freer market, the prices paid to producers tend to be quite an accurate reflection of the fluctuations of international fibre prices in dollars. In West and Central Africa (AOC) where bottom prices are fixed in advance for each marketing year prices paid to producers, which between 2000 and 2004 were already higher than allowed by global prices, were adjusted only too late to the downward trend (expressed in FCFA). This resulted in new deficits, and under the pressure of these deficits, adjustments became only more brutal and destabilising. From 2005 to 2008, producers' incomes dropped considerably in West and Central African countries because of the fall in cottonseed prices and because of the concomitant increase in the price of manures (more than 50% between 2005 and 2008 in spite of partial subsidies for inputs granted to a number of cotton value chains). The profit margin after refunding the inputs (MARI) was almost reduced by a factor of three from 2004 to 2008 in several cotton basins of West Africa, dropping from FCFA/ha to FCFA/ha. As a consequence, a number of producers neglected cotton production particularly after the 2005/06 marketing year until 2009/10. While reducing their farmed land, some nevertheless continue to grow cotton, insofar as this is the only way of obtaining manure on credit which they then partially use for their food crops. Some cotton value chains took advantage of the uptrend in the first half of 2008 to increase prices to producers for the 2008/09 marketing year, and found themselves in a delicate situation following the reversal of the market trend between September 2008 and March The high rise of international prices from April 2009 to March 2011 subsequently produced considerably higher producer prices after the 2011/12 marketing year (see table 3). Recent studies carried out in Côte d Ivoire and Mali 18 have shown that, on average, producers have returned to a MARI of FCFA/ha, close to the level reached in 2004/05, before the crisis. If the downward pressure placed on world cotton fibre prices persists, however, it will be difficult to maintain these producer prices for long, considering that in the majority of cotton producing countries in West and Central Africa, the mechanisms for fixing producer prices are adjusted in order to align them to international trends in cotton fibre prices. Despite this context, producer prices have been able to remain high (table 3). The appreciation of the US dollar compared to the EURO/CFA franc, mentioned in 3.1, contributes to maintaining this situation, which is quite favourable to producers. 18 For Côte d Îvoire, the MARI average is of FCFA/ha during the 2013/2014 year (Technoserve study, 2015 Cotton farm observation mission; For Mali, it totals FCFA/ha, 2015/16 year (G. ESTUR and N.GERGELY Study on cotton sector costs and cost effectiveness in Mali). 22 P a g e

23 Table 3: Trend in prices* 1 for first choice cottonseed from 2004 to 2016 (FCFA/kg) Country Marketing year 2004/ / / / / / / / / / / / /17 Benin Burkina Faso * * Cameroon Côte d Ivoire * Mali Senegal ND Togo *1 : Adjustable floor price *2 : + 29 CFA francs, additional purchase price calculated after the end of the period in accordance with the smoothing mechanism *3 : + 10 CFA francs, additional purchase price calculated after the end of the period in accordance with the smoothing mechanism *4 : + 4,5 CFA francs, additional purchase price calculated after the end of the period in accordance with the Interprofessional Agreement. *4 : + 5 CFA francs, additional purchase price calculated after the end of the period in accordance with the Interprofessional Agreement. Although cotton being an annual crop enables a number of producers to neglect or tend to their fields depending on the financial prospects, it appears that in the mid and long-term only efficient producers will be in a position to capitalise on their investment 19 to the extent that they can evolve in a sufficiently stable and positive environment (at the socio-political, economical, institutional, and environmental levels). This will require producing much more than a ton of cottonseed per ha, which can only be achieved by producers who have adequate equipment, quality inputs and sufficient work force. Rising up to the challenge of increasing productivity and competitiveness in general is nonetheless relevant and necessary, also during periods that are more favourable to African cotton Trends in cotton fibre production Appendix 1 describes in detail the cotton trends for the marketing years 1999/2000 to 2016/2017 in Africa by country and according to the main regional economic communities (RECs): UEMOA, CEMAC, ECOWAS, COMESA and SADC. The trend in African cotton is seen from the angle of: (1) production, (2) harvested areas, (3) yields, (4) consumption and (5) exports. Only some major trends can be mentioned here, bearing in mind that the complete and updated data have been included in appendix For a better calculation of the total profits accrued by a cotton farm this analysis should be extended to the entire farm, insofar as it is naturally diversified (cereal crops, etc.). 23 P a g e

24 The two following figures help visualise the trend in production: in Africa, in comparison with the world production (figure 4) and in the key RECs (figure 5). Figure 4: Trends in cotton fibre production in Africa compared with the world production from 1999/00 to 2016/17 (in thousands of tons) Source : ICAC statistical data, October 2016 and Cotton this month, December Figure 5: Trends in cotton fibre production in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of tons). Source: ICAC statistical data, October 2016 and Cotton this month December P a g e

25 Figure 4 shows that generally African cotton production reached a peak in 2004/05 with 2 million tons of fibre (7.6% of the world production), before falling by almost 54 percentage points during five following marketing years, with the production of African cotton fibre rising back up in 2009/10 to 0.49 million tons (4.2% of the world production), lower than the level recorded 30 years earlier. Moreover, the fall of production during this period is considerably higher than the drop observed on an international level (-17%). The collapse of African cotton production can be explained mainly because of a decrease in harvested land (see 3.5) rather than a reduction in yield per hectare, which was nonetheless significant (see 3.6). This is mainly due to a considerable loss of interest on the producers' part because of reduced cotton profitability mentioned under 3.3, and also due to the lack of organization of several West African value chains. Since 2010/11, with more favourable world prices for fibre, African production has undoubtedly risen, reaching 1.7 million tons in 2014/15 and 1.4 million tons in 2015/16, and is projected to reach 1.5 million tons (6.7% of the world production) in 2016/17. This recovery was due to the FCFA zone s cotton. Indeed, ECCAS and UEMOA experienced a significant upturn in production between the 2010/11 and 2015/16 marketing years, +160% and +125%, respectively. In contrast, production for COMESA and SADC decreased significantly, by 64% and 61%, respectively Trends in harvested cotton fields Trends in harvested cotton fields in Africa compared with the world production (figure 6) and the key African regional economic areas (figure 7) are shown hereunder. Figure 6: Trends in the harvested cotton fields in Africa compared with the world production surfaces from 1999/00 to 2016/17 (in thousands of hectares) 25 P a g e

26 Source: ICAC statistical data, October 2016 and Cotton this month December Figure 7: Trends in harvested cotton area in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of hectares). Source: ICAC statistical data October 2016 and Cotton this month December Based on production trends, figure 7 shows that harvested cotton fields in Africa reached a peak in 2004/05, with 5.1 million hectares (14.4% of the harvested fields worldwide), before falling by almost 42 percentage points during five successive marketing years and rising again in 2009/10, when the harvested cotton fields amounted to 3.0 million hectares (10.0% of the harvested fields in the world). This drop is significantly higher than the fall observed on an international level (-15%). Since 2010/11, harvested cotton fields in Africa very clearly increased, reaching 4.4 million hectares in 2015/16, and should reach around 14.2 million hectares in 2016/17 (14.2% of the global harvested area). Just as for production, it should be noted that ECCAS and UEMOA are the regions in which a large increase in cotton harvesting areas was seen between the 2010/11 and 2015/16 marketing years, with +135% and +95% respectively. COMESA and SADC followed an inverse trend, their harvesting areas declining by 61% and 54% respectively. 3.5.Trends in yields The African cotton yield, which had already been stagnant or even decreasing for about twenty years (while at the same time increasing in the rest of the world), dropped significantly almost everywhere starting in In Africa in general the yield fell by 24 percentage points between 2004/05 and 2010/11, whereas world yields remained practically stable. The increase in input costs, a less efficient use of manures (especially in West and Central Africa) and the fact that producers were less engaged in cotton farming can partially explain this drop. 26 P a g e

27 In a more general way, this situation also raises the problem of maintaining soil fertile in the long term. African cotton yields rose somewhat (+24%) from 2011/12 to 2014/15 with an average yield of 380 kg of fibre/ha expected for 2014/15, but remained below the levels seen in 2002/03 with 406 kg/ha and a decrease to 338 kg/ha expected in 2015/16, then to 357 kg/ha in 2016/17. Moreover, such results are far from reabsorbing the significant discrepancy with the world yield, which increased slightly, by 2 percentage points over that period, reaching 773 kg of fibre/ha in 2014/15. In sub-saharan Africa, the average yield in the UEMOA area in 2015/16 was higher than for the ECCAS (+11%) and COMESA (+4%) regions and significantly higher compared with the SADC area (+40%). However, the lowest yields recorded on average in the ECCAS area compared with the UEMOA region mask important disparities that become apparent by comparing countries such as Cameroon, which accounts for the highest yields in Africa, with Chad, whose recorded yields are very low. Figure 8 : Trends in average cotton fibre yield in Africa compared with average global yields from1999/00 to 2016/17 (cotton fibre kg/ha) Source : ICAC statistical data, October 2016 and Cotton this month December African cotton fibre export trend While Africa accounted for 20.3% of the world exports of cotton fibre in 2003/04, its share fell to 11.1% in 2010/11 before rising back up to 17.5% in 2016/17, ICAC statistical data projection. Africa would thus be the second largest world exporter of cotton (figure 10). This ranking is reached even when only considering the CFA countries, who together represent 14% of global exports. 27 P a g e

28 Figure 10 shows the trend in cotton fibre exports in the key RECs. ECOWAS is the firstrec exporter of cotton fibre, mostly through their UEMOA countries. From 1997/98 to 2014/15, average exports by ECOWAS accounted for 56% of the exported African volume and should reach close to 65% and 69% for the 2015/16 and 2016/17 marketing years respectively. Exports by ECCAS countries were close to 11% on average of African cotton fibre exports for the 1997/98 to 2014/15 period. In East and Southern Africa, COMESA exports accounted for an average 25% of the African exported volume from 1997/98 to 2014/15. This share has decreased in 2015/16 and 2016/17 and should settle at around 14% and 11%, respectively. Figure 9: Trends in cotton fibre production in Africa compared with world exports from 1999/00 to 2016/17 (in thousands of tons) Source: ICAC statistical data, October 2016 and Cotton this month December P a g e

29 Figure 10: Trends in cotton fibre production in the key African regional economic communities from 1999/00 to 2016/17 (in thousands of tons). Source: ICAC statistical data, May 2015 and Cotton: Review of the world situation, vol 69, n 1, September-October Trends in the use of cotton fibre in Africa Already at a low ebb in 1997/98 (3%), the share of world production intended for use (consumption) of cotton fibre in Africa has constantly declined, and should settle at around 1.3% in the 2016/17 marketing year (figure 11). Figure 12 shows the trend in the use of cotton fibre in key RECs. Today, the COMESA area consumes on average four times more fibre than the ECOWAS region. Twenty years ago, this ratio was around 2.8. In 2016/17, cotton processed in East and Southern Africa should represent 88% of all cotton processed in Africa. It should be stressed that fibre consumption in three important African consumer countries, namely Egypt, Nigeria and South Africa fell by 50% overall over the past ten years (appendix 1.4). 29 P a g e

30 Figure 11: Trends in the use of cotton fibre in Africa compared with world consumption from 1999/00 to 2016/17 (in thousands of tons). Source : ICAC statistical data, October 2016 and Cotton this month December Figure 12: Trends in the use of cotton fibre in the key African regional economic communities from 1990/00 to 2016/17 (in thousands of tons). Source: ICAC statistical data, October 2016 and Cotton this month December P a g e

31 4. DEVELOPMENTS IN WTO TRADE NEGOCIATIONS 4.1. Hong-Kong, Bali and Nairobi 20 Let's recall that negotiations for world trade liberalisation started in November 2001 in Doha and should have come to a close at the end of After this date, the WTO and its members tried to close the Doha Round, but not yet in a sufficiently comprehensive and satisfactory manner. Advances made to this day can be summarized by the three ministerial decisions in: 1. Hong Kong in 2005 where the trade ministers of WTO Members committed to treat the cotton file in a Quick, Ambitious and Specific manner. The WTO Director-General's Consultative Framework Mechanism on Cotton was established in this context in order to reach an agreed solution as quickly as possible. 2. Bali in 2013, where the WTO Secretariat was instructed to do everything to reach a negotiated and positive result on cotton during MC10. The WTO Secretariat was instructed to hold a special discussion session on the commercial aspects of cotton in parallel to the Mechanism s sessions, and to report on them during the Conference; 3. Nairobi (10 th WTO ministerial conference) in 2015, which laid proper groundwork to provide a adequate perspective on cotton through the decision made on the trade and development components. Concerning the trade component, it should be noted that two of the three pillars were the subject of firm and specific commitments: Market access was the subject of fairly restrictive commitments, taken by the Members with specific, short deadlines concerning duty and quota-free access for cotton from LDCs. This measure applies from January 1 st 2016 for developed countries and as soon as possible for developing countries; For export competition, the disciplines and commitments which were the subject of the ministerial decision on Agriculture will be implemented immediately as regards cotton by developed Member countries from December 19 th 2015 and, for developing Member countries, from January 1 st 2017 at the latest; As for domestic support, Members simply recognized its impact on global cotton prices due to the distortions it causes, without making any commitments likely to 20 Source: C4 presentation on the status of the cotton file at the WTO, given during the 21 st meeting of COS-Cotton on October 27 th P a g e

32 stop this disruptive practice. A consensus was reached to achieve a positive outcome during MC Post-Nairobi 21 It is too early to speak of achieved results, given that the provisions of the actual Nairobi decision have only been in effect since January The implementation of these measures will be ascertainable once African cotton will have been exported to importer countries for the 2016/2017 year. The issue currently complicating negotiations is that of domestic support. In the case of the United States, the fact that it considers that it no longer supplies any domestic support since the Farm Bill entered into force for makes it impossible to waive other forms of support. Although they cause the same distortion effects as domestic support, this Bill prevents their withdrawal. As for the European Union, which states that it no longer offers export subsidies since the new Common Agricultural Policy (CAP) took effect, it is not in a position to halt support to cotton producers offered by EU Member countries. C4 does not share these views and continues to ask for the withdrawal of these practices, which hinder the market forces which the WTO holds dear. Indeed, this is why the Coordinator of the C4 addressed a letter regarding this issue to the EU Trade, Development, and Agriculture Commissioners in October There are no quantified commitments from partners, but their markets should be expected to be 100% open, since these markets will be quota and duty-free for cotton and cotton byproducts from LDCs. C4 has set itself a timeline (MC11 in Argentina in December 2017) to find a lasting, negotiated, and acceptable solution regarding the complete withdrawal of domestic support policies and of any other measure causing similar distortion effects on the international cotton market. Failing this, C4 reserves the right to refer the matter to the WTO Dispute Settlement Body for its resolution. Following its last meeting in Bamako on October 26 and 27 th 2016, C4 made a declaration which, while acknowledging the results achieved by the negotiations on cotton in Nairobi, urgently calls WTO members granting market-distorting internal support and subsidies to work on advancing the work on cotton in order to reach the objectives set regarding the vital issue of cotton. This declaration also stresses the need to align the trade and developmental aspects of cotton, in particular through the provision of technical assistance and capacity development for the sector. C4 therefore invites bilateral and multilateral development partners to support the 21 Source: 32 P a g e

33 regional, continental, inclusive and multidimensional projects derived from the Pan African Cotton Road Map. Such inclusive programmes and projects should promote cotton and cotton by-product production, processing and commercialisation, in accordance with the development component of the ministerial decision of the cotton ministerial conference Latest estimates of governmental aid to cotton value chains The ICAC s latest estimates of governmental aid to cotton value chains for the 2014/15 and 2015/16 years are provided by country (12 available countries (see table 4). In 2015/16: - China provided the most aid for its cotton production. - The United States are in second place, followed by Turkey. - The European Union (Greece and Spain) are in 4 th and 5 th place, respectively - In terms of average aid per pound, Spain and Greece are in 1 st and 3 rd place respectively, China being in second place. - It should be noted that aid attributed to African countries, viz. Burkina Faso, Côte d Ivoire, Mali, and Senegal, are mainly subsidies for cotton inputs, in particular fertilizers and seeds. Furthermore, the volume of cotton produced and exported by the United States in 2015/16 represented 13% and 27% of the global share respectively, whereas for the European Union it constituted only 1.3% and 3.6%. Table 4 - Level of governmental aid for cotton 2014/ /16 Country Production (1000 tons) Average aid per pound (USD cents) Production aid (million USD) Production (1000 tons) Average aid per pound (USD cents) Production aid (million USD) China United States Turkey Greece Spain India Burkina Faso Mali Côte d'ivoire Colombia P a g e

34 Senegal Brazil Total Source: CCIC/ICAC (2016), in COMMODAFRICA, IMPLEMENTING THE DEVELOPMENT COMPONENT OF THE EU- AFRICA PARTNERSHIP ON COTTON VIA COOPERATION INITIATIVES 5.1. Opening remarks In connection with the EC delegation in Geneva and the WTO Director-General's Consultative Framework Mechanism on Cotton (DGCFMC), the PMU allotted specific funds to the African cotton sector for the period covered since the beginning of the EU-Africa partnership on cotton until June The overview table with updated data on funding (by donor) can be found in appendix 2. It shows not only funds coming from the EC and EU Member States (bilateral co-operations) for cotton-specific support projects and programmes, but also the funds and support granted by other backers: non-eu countries, agencies (multilateral and regional), which go beyond the strict framework of the Partnership. Furthermore, this table distinguishes between current and future funding (appendix 2.1) and funding for past projects/ programmes (appendix 2.2). In addition, appendix 2.3 shows the key budgetary items laid down in the ACP-EU financing agreement (No FED/ ) of the Support Programme for the consolidation of the Action Framework of the EU-Africa Partnership on cotton. It is important to broadly clarify the following points: The funding taken into account includes sector budget support to governments, which is specifically intended for cotton. The general support to cotton producer countries has been excluded here but was nonetheless substantial. The amounts shown also exclude broader support to the agricultural sector, such as any support intended for rural infrastructures that are not specifically related to cotton areas, support to farmer associations whose main activity is not cotton production, etc. Small amounts to support the cotton sector have also been excluded here but included in programmes for agricultural support or rural development. A more comprehensive estimate of the overall support granted to the cotton sector would require distinguishing, within types of funding such as budget support and broader 34 P a g e

35 agricultural programmes 22, which amounts were allotted to the cotton sector. This would be useful but complex and would require taking methodological precautions and standardising the process among development aid organizations. This is why only data from each donor for cotton-specific subsidies were taken into account in this document. This approach makes sense insofar as the EU-Africa Partnership on cotton is based on cotton-specific support. Although comprehensive, the updated table on funding in appendix 2, containing data that were checked and cross-checked, does not claim to be exhaustive. In particular, it must be noted that African cotton funding provided by China and India is not taken into account here, given that these countries do not wish to be included in the chart on aid for cotton development (WTO). This funding is nevertheless mentioned in and The WTO Director-General's Consultative Framework Mechanism on Cotton The 26 th Session of the WTO DGCFMC was held on November 23 rd It was thanks to the data collected by the PMU and the 22 nd version of the chart on aid for cotton development (WTO, November 2016), which was approved during the session held in November 2016, that appendix 2 could be drawn up Overview of funding to the cotton sector in Africa The following figures were extracted from the tables in appendix 2.1 and 2.2, this data is consistent with the information included in the 22 nd version of the chart regarding aid for cotton development. However, we ensured that only the funding granted exclusively to African countries or group of countries was selected in this section as indicated by the WTO This is the case in particular for the World Bank. It has proven difficult however to obtain a breakdown of this agency s funding specifically allocated to African cotton-growing areas. It should be noted that the World Bank regularly shared this data during the previous intra-acp programme ( ), however it was one of the programme s executive agencies at the time. 23 Some funding shown in the WTO DGCFMC cotton-specific support table and which is also shown in appendix 2.1 and 2.2 for consistency's sake, has not however been included. This is support for which African countries do not appear as recipients or which would have been double-counted. In this case, only the actual lender s funding is taken into account. 35 P a g e

36 Figure 13: Distribution of funding for current or future projects/programmes specific to African cotton, in millions of euros and percentage points, November 2016 Figure 14: Distribution of funding for past projects/programmes specific to African cotton, in millions of euros and percentage points, November P a g e

37 Figure 15: Distribution of funding for past, current and future projects/programmes specific to African cotton, in millions of euros and percentage points, November 2016 The financial support provided to the African cotton sector recorded from 2004 to November 2016 for past, current and future projects/programmes accounts for a total of 648 m, including nearly 71% ( 466 m) allocated by the EU, including the EC ( 184 m) and its Member States ( 282 m) (figure 15). The Member States who finance the African cotton sector are France, Germany and the Netherlands (in descending order of funding). Past projects/programmes alone account for a total of 427 m, of which 70% ( 303 m) from the EU, divided among the EC ( 160 m) and its Member States ( 143 m) (figure 14). Current and future projects and programmes account for a total 220 m, 74% of which come from the EU ( 163 m), divided among the EC ( 25 m) and the Member States ( 138 m) (figure 13). Concerning the 25 m contribution from the EC for support projects/programmes to African cotton, 44% is allotted to the current Intra-ACP programme on cotton, 35% is allocated to the cotton sector via the EUD of Côte d Ivoire, and the rest of the funding is allocated to support Benin, Burkina Faso, Mali, Togo and Tanzania. Member state support (138 M ) represents 85% of EU funding. France, through the AfD, represents 69% of this funding, followed by Germany (19 %) and the Netherlands 24 (12%). Nearly 36% of aid is multi-country, while the remaining 64% is allotted per country and distributed among Benin, Cameroon, Côte d Ivoire, Mali and Mozambique (see appendix 2.1). 24 It should be checked whether the Netherland s 16.5 million euros of funding is in fact entirely allocated to African cotton, however. This sum should otherwise be reduced. 37 P a g e

38 Overall, total funding of current or planned projects has gone up by nearly 22% (220 M ) when compared with the 180 M estimated in July % of this increase comes from EU funding, and 47% from other countries, the first of which is the United States. The increase in EU funding is mainly due to EU Member states, chief among them France (+62%), whereas EC funding has gone down by 8%. With the emergence of new African strategies for agricultural commodities 25, directed towards diversification/value chains, we can also ask ourselves if in the future, specific aid like the current cotton programme could still be funded, at least within the intra-acp framework. It should also be noted that, in the past, EUDs have played a very significant role in funding aid for Cotton in many different African countries, within the framework of Country Strategy Papers and national indicative programmes. The 9 th EDF and what remained of STABEX were among the preferred funding tools. As part of the 10 th EDF, subsidies to African cotton were more often intended for structural actions on an Intra-ACP level (the current cotton programme took on from the AAACP cotton component). For the 11 th EDF, with regard to the EUD, funding specific to African value chains are virtually non-existent, in spite of the fact that agriculture and food safety often appear among the priority sectors in African cotton producer countries. Furthermore, aid from multilateral agencies (WB, CFC/ICAC, FAO, ITC, UNIDO ) now only represents 2% of total funding for current or planned cotton aid. The relative share of funding provided by non-european states (United States, Brazil, Switzerland, Australia), however, has reached 24%, a 5% relative increase compared to July Current key aid to African cotton, funded by the EU (EC and EUD of the Member States) Opening remarks This presentation describes the technical aspects of support granted to the African cotton sector that is financed by the EU, and is complementary to appendix 2.1, which presents the state of funding as of November Information given hereafter was derived from data collected by the PMU from key donors, in preparation for the 25 5th and 26 th Sessions of the WTO DGCFMC. Apart from the Support Programme for consolidating the Action Framework of the EU-Africa Partnership on cotton (Intra-ACP Cotton Programme), this information is based on data that donors could or wanted to provide. There is therefore no claim to be exhaustive. Only current or planned aid for African cotton is presented here. Funding which has been completed since July 2015 was presented in the previous Partnership update report (December 2015). Bear in mind that it is not always easy to obtain reference reports 26 (final reports, 25 Such as the strategies developed by the African Union and the ACP Group of States which have yet to be finalized. 26 French : English : 38 P a g e

39 evaluations, etc.) of other aid organisations, which would make it possible to carry out this work more effectively. The reason for this can sometimes be found in the significant amount of time required before these documents can be shared. Nevertheless, the PMU continues to seek this type of information The Support Programme for the Consolidation of the Action Framework under the EU-Africa Partnership on Cotton (Intra-ACP Cotton Programme) The Intra-ACP programme, accounting for 11 million ( ), funded by the EC under the 10th EDF, is described in 1.2. It should be underlined that following the cotton component of the AAACP programme ( ), the current programme directly carries out the implementation of the EU-Africa Partnership on cotton. The key spheres of activity conducted by the implementation agencies ITC/CCI and FAO are posted online and regularly updated on the EU-Africa Partnership on cotton website. For each of these agencies, the footnote links to the presentation on the results achieved made during the last programme steering committee, on October 26 th Seven projects (actions) have been selected for the grants facility (call for proposals ) and have been contracted. They are all undergoing implementation, with the exception of the project assigned to UEMOA 28 whose launch was unduly delayed for various reasons. UEMOA ultimately had to drop the project given the material impossibility of its realisation in compliance with rules and procedures and within required deadlines. Appendix 3 lists the six projects whose implementation has ended, the last of which took place on November 30 th It should be noted that their scope is both national (Cotton & cashew council project/côte d Ivoire, UNPCB and Authentic Africa/Burkina Faso) and regional (AProCA, ECCAS and CIRAD projects). A presentation of first results was made by the PMU during the last programme steering committee (October 2016). It can be found at the following link: With regard to the cotton facility s use of short-term expertise external to the PMU, two rounds of calls for proposals were set up. They led to the selection of nine applications (five during the first round of calls and 4 during the second) whose Terms of Reference (ToRs) were validated by the ACP Secretariat. The implementation of these actions began starting in January Appendix 4 summarizes them. Two of them pertain to Côte d Ivoire (Federation of Cotton Producers, Ministry of Industry and Mining), two to Burkina Faso (UNPCB, GEOCOTON/SOCOMA), one to CNPC/Cameroon and two to ACTIF (Ethiopia/B2B and African headquarters of the cotton expertise), one to Tanzania 29 and one to the NPCA (PACRM). The first results, obtained during the implementations of this short-term expertise, were presented 27 For the ITC: (R.1.1 and R.3.2-R.3.3) For the FAO: (R.3.1) 28 Project supporting the implementation of actions for a long-term and wide-spread understanding of the achievements of the Project for the prevention of cottonseed contamination in West Africa. 29 On training to improve cotton quality in Tanzania. This request for short-term expertise support, stemming from the Tanzanian Ministry of Agriculture, Food and Cooperatives has to be cancelled, in particular after it was observed that this study s inception report did not meet the tasks required and described in the ToR. 39 P a g e

40 by the PMU during the October 2016 programme steering committee (see link to access). The last short-term expertise actions should end in April 2017 at the latest. Additionally, studies and specific short-term expertise work are directly coordinated by the PMU. They address: Expertise work for the finalisation and harmonisation of the PACRM began in mid- September During the 20th COS-cotton meeting (Benin, March 2015) The Cotonou conclusions and recommendations regarding the PACRM have enabled the establishment of the Technical Working Group made of representatives from the AU, the NPCA, and RECs expected to finalise this work. The need to intensify information exchanges and work among institutions potentially falling under the PACRM, in particular at the Working Group level, has required an addendum to extend the PACRM expert. This extension began in mid-september 2015 until the adoption of the final technical PACRM report during the 21st meeting of COS-Cotton on October 27th The adoption of the technical report brought about political framing and backing opportunities for the PACRM which should become clearer by late March The presentation of PACRM final technical report is available at the following link: A study on the progress of research on cotton in Africa with a diagnosis and prospects was launched in the first quarter of The first results, obtained during the implementations of this short-term expertise, were presented during the October 2016 programme steering committee ( This study should end in March 2017 at the latest. As a result of implementation delays for a number of actions, the programme was extended for a few months with the same budget, until June 25 th 2017 for the technical assistance/pmu and until the end of May 2017 for executive agencies (ITC, FAO). This extension will also allow for the programme s final event to be held (results dissemination and future prospects for support) which, at the invitation of Burkina Faso, will take place in Ouagadougou, from March 27 th to 31 st 2017, in synergy with the Dan Fani Fashion Week, Ouagadougou International African Textile Design Fair (SIDTAO Salon International du Design Textile Africain de Ouagadougou) Improvements in incomes and food security of producers through diversified organic production systems (SYPROBIO) "Syprobio" (système de production biologique, organic production system) is a 5-year project ( ; EC 2.96 m; total funding: 3.29 m) awarded following a call for proposals, GPARD, (Global Programme on Agricultural Research for Development) launched by the EC under the FSTP research component. Syprobio carries out research on organic farming (concerning cotton crops in particular). 40 P a g e

41 The Syprobio project 30 aims at "increasing producers income and food safety via diversified organic production systems and is one of the current programmes that support organic cotton in Mali, Burkina Faso and Benin. The contract was signed in December 2010 and activities started in The objectives and expected results of this project are to identify, test and disseminate organic production techniques and strategies that are diversified, profitable, sustainable and adapted to climate change in West and Central Africa. The stakeholders in the project are national research institutes: IER (Mali), INERA (Burkina Faso) and INRAB (Benin); farmer organizations: MoBioM (Malian organic movement), UNPCB (National Union of Cotton Growers of Burkina), U-AVIGREF (Union des Associations Villageoises de Gestion des Réserves de Faune, Benin); Helvetas Swiss Intercooperation, FiBL and the Research Institute of Organic Agriculture. Since 2013, the eight (8) partners committed themselves based on yearly action plans. The major innovation of this project is the creation of a participative and transdisciplinary mechanism for co-learning and co-construction around climate-adapted technologies, led by farmers themselves, at the village level and integrated into the agricultural value chains, which ultimately improve and ensure food security in West Africa. This mechanism is developed around West African cotton growing and implemented with farmers practising organic farming in three countries: Benin, Burkina Faso and Mali. Around one hundred producer-researchers are taking part in the project. Capitalisation of the research and tests with farmers has been renewed annually. Local innovation platforms are organised at the national level in order to be aligned with sectorial priorities for food security, eradicating poverty and adapting to climate change. Regional talks enable experience sharing among countries, and coordinating with sub-regional policies and regional and global markets. According to project managers, after four years of implementation, the initiative has proven that organic and diversified cotton production is feasible on a large scale for small farmers (with less than 10 ha of arable land) and that the microeconomic advantage is comparable and competitive with conventional farms. Research also appears to show that the "researchfarmer" networks built around specific innovation projects can lead to proven solutions more efficiently and effectively than conventional research. This initiative has also shown that small farmers and women in particular are rehabilitated through participative research by facilitating the emergence of solutions, which are adapted to their socio-cultural, economic and institutional contexts. Finally, interdisciplinary and multi-actor research, with a strong emphasis on social science, can help grasp the complexity and diversity of the society - natural environment and of market systems without getting lost in academic minutia. 30 For further information : 41 P a g e

42 Support to the cotton sector recovery plan Côte d Ivoire It should be recalled that the EUD to Côte d Ivoire has greatly bolstered the Ivorian cotton value chain since Therefore, for past projects/programmes, the Ivorian cotton value chain received nearly 34% of the total EC funding to African cotton sectors. This aid accounts for approximately 35% of the total EC funding of current support to African cotton value chains. The EC aid to Côte d Ivoire certainly played a major role in saving the Ivorian cotton value chain, which was confronted with a number of severe issues in the decade (political unrest, domestic problems and a severe financial crisis). However, this was made possible thanks to the government's and stakeholders' determination to save and redress the cotton value chain. In particular, this resulted in the adoption of a recovery strategy for the cotton sector in 2007, which was subsequently reviewed and updated. In 2013, within the framework of the reforms to the cotton and cashew nut sectors, an operational document for reforming the cotton sector 31 and an implementation matrix were designed under the aegis of the Ministry of Agriculture. The EUD financial support for the recovery plan of the cotton sector falls under this framework (Flex; ; 8.7 m). In addition, the EUD also supports a programme to repair roads/tracks in cotton areas (FLEX, 9.6 m). Funding revolves around three key actions: (1) Support to stimulate cotton research ( 2.8 m); (2) Support for agricultural counselling ( 3.9 m) and (3) The consolidation of stimulus for animal-traction farming ( 2 m). (1) Support to stimulate cotton research (04/ /2016) The specific aim is to introduce innovations developed by agricultural research into cotton farms in the hopes of increasing cotton farmers' revenue. Ten operational activities are implemented. 1. Adaptation of new cotton varieties to different agro-ecological conditions 2. Feasibility study on Genetically Modified (GM) Cotton 3. Integrated management of emerging cotton pests in Côte d Ivoire 4. Insecticide foliar application techniques for cotton 5. Improvement of technical lines according to climate developments in cotton growing regions 6. Diagnosis and correction of soil fertility in Cotton/Food Crop cultivation systems 7. Use of edible legumes and cover crops 8. Monitoring of green cover and research on efficient methods for weed management in cotton-based cultivation systems 9. Rehabilitation of Observation Posts (OP) in cotton production areas 31 Ministry of Agriculture of Côte d Ivoire. Operational document for reforming the cotton sector. September 2013.p P a g e

43 10. Transfer of knowledge, from research to agricultural counselling 11. Cotton farm observation missions Most activities are implemented by the National Centre for Agronomic Research (CNRA), the Inter-Professional Agricultural Research and Advisory Fund (FIRCA) ensuring their coordination. Results obtained through this research should be made available in (2) Agricultural counselling support (11/ /2015) The specific aim of this action is to implement a sustainable technical and financial management plan for agricultural counselling ensuring financial transparency and quality control for this action. The main implemented activities are (i) Contracting agricultural advisors and executing the contracted agricultural counselling; (ii) Monitoring/assessing this counselling; (iii) Training supervisors; (iv) A restitution workshop for beneficiaries; (v) The action's management activities. Five agricultural advisors have been contracted and their work is under way. They are major operators in the cotton value chain: the Compagnie ivoirienne pour le développement des textiles (CIDT), the Société d Exploitation cotonnière de Ouangolo (SECO), the Société cotonnière Ivoire Coton, the Compagnie Ivoirienne de Coton (COIC) and the Union Régionale des Entreprises Coopératives de la zone des Savanes de Côte d Ivoire (URECOS- CI). (3) Consolidation of stimulus for animal traction farming (12/ /2015) The specific aim of this action is to accelerate the recovery of the cotton value chain by developing animal traction farming. It consolidates the Project to Revive animal traction farming (4,2 M, STABEX) which ended in The key implemented activities are (i) Supplying cotton farmers with plough cattle (2750), equipment, and spare parts for animal traction farming (1600 "multiculteurs" or toolbars, 300 field-ploughs), veterinary products (7000 veterinary kits) and salt licks (7000); (ii) Tsetse fly elimination; (iii) A study on the motorisation of cotton farming and traditional forging (already completed, report currently being validated) and (iv) The implementation of project execution agencies. It should be noted that the last activities in support of the cotton sector recovery plan should end in The 11 th EDF does not have any support specific to the Ivorian cotton sector. A project to accelerate the application of the law on the rural property sector in the cotton basin is being launched, however (FOOD/2016/ Intercoton, , 04/ /2018). This project aims to test an approach to issues relating to land tenure, including in particular securing land use rights, with the cotton inter-profession (INTERCOTON). This support is not specific to the cotton sector per se, but this action could prove to be a very useful source of knowledge for the sector. 43 P a g e

44 Aid to increase the incomes of small cotton producers thanks to improved quality and market access Tanzania This grant from EUD Tanzania accounts for m over the period. The partner for the implementation of the project is the Tanzania Cotton Board (TCB). The EUD provided for a preliminary management capacity building in the TCB to ensure that the project is managed appropriately. As indicated by the wording, this project aims to improve the quality of cotton and market access. In Tanzania, as in other East and southern African countries but to different degrees, there is mistrust between producers and ginners, insofar as the latter try to buy cotton at the lowest possible price (there is no bottom price announced at the beginning of the marketing year as in WCA cotton producer countries). Moreover, producers are significantly less supervised. The consequence of this situation, in which producers have few incentives to improve the quality of cottonseed, is that cotton quality worsens. This project fits within the framework of the Trade and Agriculture Support Programme Phase Two (TASP II), for which support focused on horticulture, fishing, cotton, coffee, and tea. A mid-term assessment 32 of this programme revealed the need to identify clear incentives for producers and ginners in order to improve quality and standards West African Organic and Fair-Trade Cotton Project The project is currently being developed. A 3 m grant should be awarded by the AFD. This project should support producers in order to increase organic cotton yields, in particular in Mali and Burkina Faso. This project will build on the results of the PRCC Project sub-regional support project for developing fair trade and organic cotton in West and Central Africa (AFD, 4.7 m, ). The aim of the PRCC was to ensure that cotton producers in 4 West and central African countries (Benin, Burkina Faso, Mali and Senegal) would benefit from the advantages of fair trade and organic farming. It aimed to increase competitiveness in the cotton value chain as a whole and to promote cotton on the world market 33. One of the major constraints in cotton production in general, but even more so for organic cotton, is low yields in the fields. It was also underlined that research must play an important role. In addition to yield issues, the trend in the differential between the purchase price of conventional and organic cottonseed is also a determining factor. Today, "fair trade" areas can offer high quality cotton, but it is not necessarily priced as it should be, and even when it is, farmers are not always paid according to standards. Thus, in Mali, not a 32 ATKINS& COWI (2016). Mid-term evaluation of Trade and Agriculture Support Programme. Phase 2 (TASP II). Version 1. March For further details, see the previous version of the update on the EU-Africa Partnership on cotton, December P a g e

45 single kg of fair trade cotton has been sold since 2010/11 and part of the production has been sold at conventional cotton prices (source: AFD, supervision mission, April 2015). We can also refer to the report of the International African Fairtrade and Organic Fairtrade Cotton Forum, which took place in Paris in March This document highlights the solutions which fair trade and organic fair trade offer, while also pointing out the challenges which remain Project to strengthen governance and improve the productivity and sustainability of farms in Mali 35 AFD grant of 11 m (total cost: 20 m co-funded by CMDT, IER, CIRAD, and producers), 2007/15. The project falls under the three points set out by the AFD to contribute to the French Cooperation strategy in support of the cotton value chain, namely: (i) support to structure value chains (ii), improve competitiveness and (iii) support to improve price risk management. On a national level, the project lies within the scope of institutional reforms and improving the productivity and sustainability of farms (PASE2). The project aims to: (i) increase producers' income and reduce their vulnerability; (ii) reduce macroeconomic risks that are due to the weighting of the cotton value chain in the Malian economy by improving its competitiveness and governance and by modernising price risk management. The specific objectives of the project are: (i) help stakeholders assume their respective role in the governance of the cotton value chain by reinforcing their capacities; (ii) strengthen productivity, increase diversification and the sustainability of farms in the cotton value chain (family farm counselling, functional literacy, access to financing linked to the cotton guarantee, professionalization of the procurement of inputs for food farming); (iii) contribute to ensure incomes for producers, in the cotton value chain and the government (managing price risks, board of directors, quality policies, reducing constraints associated with boosting diversification of crop and livestock). The project has 4 components: 1. Improvement of the productivity and sustainability of family farms. This component includes (i) research and development activities via an observatory on the evolution of farms and farming systems in cotton-growing regions; (ii) the ecological intensification of farms, through the development on technical innovations (aiming for higher yields and better soil fertility) adapted to the different agro-ecological areas and farm types For further information, see of the previous version of this report (December 2015) 45 P a g e

46 and through broad communication to outreach and counselling systems for their dissemination; (iii) the dissemination of a family farm advisory service, with an approach based on guiding farm managers through an overall assessment of their farms and searching for appropriate technical and economic solutions. 2. Capacity building/professionalization of the cooperative union network in order to guide them towards mastery of the duties which were transferred to them or which they must co-manage within the future Interprofession (in particular, cereal input supply, monitoring cooperative credit management, price risk management, information system). 3. Support for the development of a concerted public policy in cotton-growing regions which includes (i) the promotion of inter-professional dialogue; (ii) economic analysis capacity building for the state to improve decision-making guidance, through studies assessing the impact of cotton on farmers' revenues, the local economy and national growth, and modelling the effects of an exogenous shock. 4. Project steering The project s execution is experiencing difficulties related to (i) the suspension of the AFD s activities during the Malian crisis; (ii) the lack of a common vision regarding the future of the sector s reform ever since its privatization was discontinued36 and (iii) the governance of the Cotton Producers' Cooperatives (SCPC) network, their national leaders being very politicized; Nevertheless, progress has been observed in regards to some aspects, and Research & Development actions are being carried out satisfactorily. Steps have been taken to intensify the pace of activities, in particular as concerns the family farm advisory system and support for the professionalization of the cooperative network (source: AfD, supervision mission, April 2015). A mid-term assessment should have been carried out during the second half of The project could be restructured depending on its conclusions Projects under development involving the Malian cotton sector Two AFD-funded actions are under development and involve the Malian cotton sector. These are: - Support to the CMDT, to modernize its transportation fleet ( 15 m) and - The repair of rural paths in cotton areas ( 31 m) More information regarding these projects will be given in the next edition of the report. 36 The dissolution of the Cotton Sector Restructuration Mission (MRSC) and the creation of the Cotton Sector Monitoring Unit (CSSC) within the Ministry of Agriculture should be noted, which is consistent with the discontinuation of the privatization plan the MRSC was developing since its inception, and which also demonstrated the Ministry of Agriculture s reinvestment into the cotton issue. 46 P a g e

47 Support to producers and producer associations, including in the cotton areas Benin AFD grant of 10 m (total cost 10.8 m), 2007/16. This is the Support programme to production dynamics in cotton areas (PADYP 37 ). This programme, whose financing agreement was signed in February 2007, pursues three main goals: (i) improve the technical and economic skills of farmers, by increasing advisory services to family-run farms, notably by introducing specific literacy and curricular courses. In 5 years, the objective is to involve farmers, including in the cotton area; (ii) improve the sustainable features of family-run farms in cotton areas by strengthening specific agricultural techniques; (iii) strengthen the structure of Producer Organizations in order to enable them to manage their finances more effectively and transparently and improve their provisioning and production marketing. This project is still being implemented and should be completed in 2016 or The project s last stretch worked to build on its achievements by sharing its experience in the field with as many rural development actors as possible. A series of documents for the dissemination of this information were produced to this end Support for increased security and integrated management of agro-pastoral resources (ASGIRAP) with a specific component for improving productivity in the cotton sector Cameroon France / AFD, 10 m, on C2D resources (Contrat de Désendettement et de Développement, Debt-Reduction Development Contract), 2013/17. The ASGIRAP programme covers the North of Cameroon. The financing agreement was signed in February This programme will make family-run farms in the North of Cameroon more resilient and will improve their productivity by promoting ecologically intensive practices. This will include actions conducted on the land (e.g. protecting and planting trees, rehabilitating water supply points for cattle, reopening transhumance tracks, etc.) and on farms (e.g. production and storage of fodder, introducing leguminous plants in crop rotations, farming systems on cover crops, etc.) All these projects will be co-financed by farmers. The programme will benefit approximately 200 villages located in 20 municipalities covering the entire northern province, the Far North cotton region and the northern area of Adamaoua. A programme supervision mission carried out by the AfD in 2015 has revealed that the initiation of activities has been delayed by more than a year, mainly as a result of issues in the 37 For further information: 38 These documents are available at the following address: 47 P a g e

48 establishment of the programme coordination team which has finally been implemented. The chronic insecurity which rules the Far North does not make things easier, in particular in terms of identifying recipients. The programme also suffered from the alarming state of the cotton sector in Cameroon, due to the compounding of a number of adverse circumstances (in particular for the 2013/2014 year) and management issues specific to SODECOTON (late payment of producers, procurement exercises, etc.) This mission has also noted that beyond situational factors, previous experience in terms of dialogue and development of resource usage rules have often led to beneficial short-term effects but often had trouble taking hold in the long term. The implementation of a programme test phase in three pilot communes should begin very soon. It should be noted that the mission statement for the partnership between the ASGIRAP and SODECOTON projects was signed in March 2015, and that the implementation of the cotton systems support component has begun Support to the cotton sector (road maintenance, animal traction farming, counselling producers, strengthening cooperatives and support to inter-professionals) Côte d Ivoire France/AFD of 23.2 m, with C2D resources, 2013/17 The support lies within the scope of the cotton value chain reform. An operational document was produced in September Support by the EUD to Côte d Ivoire falls within this framework (see 5.4.4). This support is therefore complementary to the aid funded by the EUD to Côte d Ivoire and the World Bank. It relates mainly to: road maintenance, animal traction farming (a delivery of 20,000 oxen and 10,000 strings for animal traction is expected), counselling producers, strengthening cooperatives and support to inter-professionals. It should be noted that the animal-drawn cultivation component has suffered from a number of problems, particularly regarding the delivery of plough oxen, leading to significant delays in implementation Competitive African Cotton Initiative (COMPACI) Promotion of cotton production in sub-saharan Africa: Cotton made in Africa (CmiA) Phase II COMPACI's objective is to promote the sustainable production of cotton in Africa and develop a demand for cotton that is Made in Africa. The pilot phase of the Cotton made in Africa CmiA project ( ) involves three countries: Burkina Faso, Benin and Zambia. Following a positive assessment, the COMPACI (Competitive African Cotton Initiative) programme was extended. The Bill & Melinda Gates Foundation (B&MGF) and the German Ministry for economic cooperation and development (BMZ), have contributed financially since 2009 and for a fouryear period in order to extend the programme to more than one-quarter million producers and spread agricultural activities to another six African countries. 48 P a g e

49 The implementation of the project was entrusted to DEG 39 (Deutsche Investitions und Entwicklungsgesellschaft KfW Bankengruppen) and to GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit). The partners for on-site implementation are private cotton companies who carry out their activities in Africa and contribute more than 50% of the programme's funding 40. As the first phase of the COMPACI project ( ) was assessed positively, the programme has been extended to a second phase since January 2013 ( , 26.3 m), and will be financed for three additional years by the Bill Gates Foundation, the BMZ, Aid by Trade Foundation (AbTF) as well as the British Gatsby Foundation. To date, COMPACI has developed collaborations with private sector cotton companies in Benin, Burkina Faso, Côte d Ivoire, Ghana and Cameroon in Western and Central Africa, as well as in Ethiopia, Malawi, Mozambique, Uganda, Tanzania, Zambia and Zimbabwe in Eastern and Southern Africa. The ultimate objective of this second phase of the COMPACI project, which ended in 2016, is to help approximately 650,000 small producers over a period of seven years to improve the output both of their cotton and food production, so that they can increase their agricultural income by 35% and their food production by 15%. This way the initiative will involve almost 30% of all the small cotton producers in Sub-Saharan Africa. It is important to stress that the AbTF owns the CmiA label and is in charge of marketing. The BMZ, via the GIZ and DEG, finances training courses for cotton producers and checks of the CmiA system. A criteria matrix, made up of exclusion, viability (production levels and ginning) and managerial criteria is established and regularly updated 41. It should be noted that in 2014, a CmiA organic standard, based on a criteria matrix 42 and a verification system was launched in Tanzania. The CmiA development policy includes: checking and assessing the impact of social investments on small farmers. These investments are made possible by transferring increasing amounts of revenue accrued through license fees paid by retailers. The distribution network currently includes Germany, France, Spain, Belgium, the Netherlands and the United States. For more information please visit the CmiA website The German investment and development company 40 These partners are: Alliance Ginneries Ltd., Biosustain, Birchand Oil Mill, Cargill, Dunavant, Faso Coton, Great Lakes Cotton Company, Ivoire Coton, NGS Investment Ltd, Olam, Plexus Cotton MZ, Société d'exploitation Cotonnière Olam (SECO), Socoma, Sodécoton and Wienco P a g e

50 Better Cotton Initiative (BCI) The Better Cotton Initiative (BCI) 44 aims to make improvements in the culture around cotton which have a measurable effect on an economic, environmental and social level. The BCI meets the minimal production criteria required and aims to achieve continuous improvements, which are assessed by independent bodies. The BCI works with local partners to implement a "mass market" approach with an aim to produce larger quantities of sustainable cotton while stimulating and supporting the global market demand. The Netherlands participates in funding( 16.5 m, ) directly supporting producers under the BCI label. In 2016, such support should reach nearly 800,000 producers collaborating with more than 40 partners in 55 projects. BCI also received subsidies by ICCO, IDH, the Rabobank Foundation, SIDA, SECO and WWF- Sweden who joined the Better Cotton Fast Track Programme partnership to support partners who implement BCI projects with a joint fund for field projects of 22 million. In 2015, approximately 2.6 million tonnes of cotton fibre (approx. 10% of worldwide production and a +30% increase compared to 2014) were produced under a BCI license by 1.5 million farmers in 21 countries around the world. In Africa, BCI is present in Mali, Senegal, Mozambique, and, in partnership with CmiA, in Ethiopia, Tanzania, Zambia, Zimbabwe, Côte d Ivoire and Ghana. This cotton is intended for the supply chains of BCI members, including at the same time large traders (Dreyfus, Ecom, Cargill, etc.) brands and distributors (Nike, Ikea, H&M, etc.). The BCI is financed by a rapidly-increasing number of members, totalling nearly 900 from 41 different countries. Members include brands and retailers, ginners, spinners, tradesmen and industrialists, as well as producer organizations and NGOs. Since 2013, the BCI has evolved to a new financing model in which expenses for facilities will be covered by member fees whereas costs for field activities for producers (such as training courses) will be covered by licensing rights paid by brands and distributors and co-funded by international organizations. The BCI's objective by 2020 is to take a 30% market share of the world production of cotton fibre, with 5 million producers. Comparison and collaboration between BCI and CmiA. Whereas the BCI is addressed to small and large cotton producers throughout the world, CmiA relates exclusively to small cotton producers in sub-saharan Africa. These two initiatives focus on training courses and support given to farmers and promote cotton production according to sustainable principles and criteria. In order to maximize their joint impact and avoid overlapping commitments, the BCI and the Aid by Trade foundation which owns the CmiA label established a partnership which 44 For further information: 45 This new funding is under development. This support will be part of Initiative Sustainable Trade: Cotton Value Chain Development. This funding does not only apply to Africa, however, but also Central Asia and China, where the BCI is present. 50 P a g e

51 makes it possible to sell CmiA cotton as Better Cotton on the international market. On the other hand, Better Cotton cannot be marketed under the CmiA label Current key support to the African cotton sector, financed by other actors Cotton Partnership Programme C4-CP This new C4-CP project 46 is financed by the United States via USAID ($14.8 m in ), took place in the final stages of the West Africa Cotton Improvement Program (WACIP) (USAID, 27 USD million, ). The overall objective of the WACIP was to reduce poverty and hunger by increasing the incomes of cotton producers and processors. The specific objectives were: (1) improve the productivity of cotton and related crops and (2) increase the value of cotton products. These objectives must be reached within an improved institutional and regulatory framework. The countries included in the WACIP area of intervention are the C4 (Benin, Burkina Faso, Mali and Chad) as well as Senegal. After three extensions since its original closing date at the end of November 2009 the WACIP ended in A final assessment report 47 was issued in It does not take into account the extensions to the WACIP. The new 4-year C4-CP project actually started in June It is implemented by the IFDC. The ICRA, sub-contracted by the IFDC, provides technical support to improve training courses and help the outreach of the project. The C4-CP supports public and private organizations, both regional and national, who privilege small cotton producers (men and women) and who take stock from the success and failure of the former investments of the American Government, while strongly insisting on three key sectors: a. Sustainable increase in agricultural productivity: governmental bodies or existing private companies will be given support to identify and disseminate technologies that increase productivity and competitiveness of the cotton production system (cotton + food crops in rotation with cotton) while solving issues such as soil impoverishment, the inappropriate use of agricultural inputs and setting cotton in its agro-ecological context. b. Establishing partnerships: develop the coordination and capacity building thanks to strategic relations and productive partnerships, which can bring a significant and lasting change on the regional and national level. c. Financial and social advantages for women: remedy the inequality of women s access to goods and services, or to the advantages derived from their investments. Promote 46 For further information: 47 For further information: 51 P a g e

52 certain approaches, spread new models and conduct studies on the effectiveness of various ways of spreading know-how RECOLTE project for the improvement of the organic cotton value chain Burkina Faso This project is funded by the United States via the USDA ($12 million48), It is implemented by an American NGO, Catholic Relief Services (CRS), in collaboration with INERA and Texas A&M University AgriLife Research. It is also expected that the Ministries in charge of Trade, Industry, and Agriculture, as well as the private sector work with the project in order to provide greater opportunities to its beneficiaries. The project aims to improve the organic cotton value chain and agricultural and economic income, as well as food security for 10,000 small producers in Burkina Faso, the target demographic being composed of at least 30% women. The two strategic objectives of RECOLTE are increased agricultural productivity and market access for agricultural products. In order to increase agricultural productivity, RECOLTE s interventions were focused on access to quality inputs, farming equipment, improved access to and quality of extension services, and improved quality of farm and land management. The final outcomes are to increase the average cultivated area as well as the average yield for each producer, thereby improving their incomes, and multiplying the volume of organic cotton production by two by the end of the project in In order to make it easier for agricultural product to reach the market, the project took part in creating added value, and improving market access and transaction efficiency. This strategic goal aims to broaden demand for organic agricultural products and increase revenue Programme to develop the cotton value chain in Africa Financed by Brazil, this project followed up on a preceding phase implemented from 2010 to 2013 with a subsidy of 5.4 m 49. The first phase of the project in particular made it possible to achieve the following results: rehabilitate the experimental station of Sotuba (Mali), which is the regional centre for continuing education. The Sotuba station will encourage the research and dissemination of techniques which are validated and certified by rural populations; disseminate scientific results as a strategic factor for socio-economic growth in small communities and for social integration thanks to small-scale agriculture; 48 The RECOLTE project is funded via the monetisation by CRS of 11,750 tons of white rice offered by the American government. The income generated by the sale of this product is utilized to implement the project in Burkina Faso. 49 Source: Information provided by the C4 and communication by Brazil during the meeting of the Director-General's Consultative Framework Mechanism for Cotton in June P a g e

53 strengthen the entire cotton supply chain by improving the yield and quality as well as the access of small farmers to research the results, with the aim of establishing sustainable agriculture; draft a handbook with best agricultural practices and technical documents in support of technicians with the objective of stimulating the production of cotton in the C-4 countries. The second phase of the project, from , and an allotted $ 19.8 m, aims to touch a greater number of African cotton producing countries by disseminating the results achieved with the first phase. It revolves around issues of food safety and therefore will aim to stimulate not only the yield and quality of cotton, but also the production of foodstuffs through the rotation of crops. The actions hereafter may also be considered for the second phase of the project, depending on the requests by applicant countries: distributing the Handbook of good agricultural practices to small local farmers, also by providing training courses to agents in charge of agricultural extension (communicators) and to farmers; official transfer to the four participating countries of the four Brazilian varieties (cultivars) which are best adapted to the needs of Africa in order to ensure a continuous selection process; continuing joint actions which aim at developing zero tillage farming, cultivars testing and managing parasites; building and equipping laboratories in order to contribute to the capacity building of local institutions; Technical assistance programme of China C4 countries Although not mentioned in the chart on the cotton development aid by the WTO, it is necessary to mention China's support. In December 2011, China announced a technical and financial support programme for cotton for the C4 countries 50 spread out over a 3-year period, with an allocation of $ 20 million, initially from 2012 to 2014, but which was extended. This support should take the form of: technology transfer; technical aid for research, promoting good varieties and seeds, and cotton processing; supplying improved varieties of cotton, adapted to the soil; supplying agricultural machinery, manure/inputs and pesticides; 50 Source: Information provided by the C4 and communication by China during the meeting of the Director-General's Consultative Framework Mechanism for Cotton in June P a g e

54 financing targeted training courses for cotton sector personnel in the C4 Group of countries, as well as sharing experiences among the parties through bilateral or multilateral training cycles on subject matters such as farming, processing and cotton transformation; granting financial support to programmes relating to cotton sectors in the C4 countries in which Chinese companies are involved. According to the Chinese representative who was present at the 23 rd Session of the WTO Director-General s Consultative Framework Mechanism on Cotton (July 9, 2015), the implementation of this programme has begun and resulted in the delivery of agricultural equipment, machinery, improved cotton varieties and the transfer of irrigation and plantation technologies to Benin, Mali and Chad Technical assistance programme of India - C4 countries As for China, India's budget is not shown in the chart on WTO cotton development aid. A programme for technical assistance to the cotton sector with a budget of 210 million rupees, approximately 2.6 m, is currently being implemented in Benin, Burkina Faso, Mali, Chad, Malawi, Nigeria and Uganda for a three-year period ( ) 51, which was extended. This programme was officially launched in March 2012,in New Delhi. It was then set up between May and July The Programme focuses on the following major areas: increase cotton production (by expanding farmed lands and increasing productivity); improve the effectiveness of outreach and support services; strengthen research and development and quality control; provide marketing and distribution infrastructures; strengthen and develop an industry based on cotton by-products by bringing added value; create or strengthen the downstream industry in the textile and clothing sector. The programme is implemented, inter alia, by the large institutions of the Indian cotton sector, namely the Central Institute for Cotton Research (CICR), the Central Institute for Research on Cotton Technology and the Directorate of Cotton Development (DOCD) Developing a national system to classify cotton in Kenya and Mozambique The Common Fund for Commodities (CFC), in conjunction with the ICAC/CCIC, is financing a 4-year project for , with a budget of $2.5 m /CFC/ICAC/44. The cotton market will increasingly require a classification by cotton instrument. The two countries who are involved in the project started investing in instrument measurements and 51 For more information on the joint project: 54 P a g e

55 in required physical infrastructures and techniques. The project will help these 2 countries set up powerful classifying devices, such as training an ad-hoc team and managing a system that will test all the cotton bales. This will allow cotton salespersons to fully integrate quality into the commercial value of their product before marketing it on the national and international markets. Based on a clear and consistent governmental commitment, it is expected that from today until the end of the project instrumental classification will cover the entirety of the cotton produced by each country, which will also enable producers to better understand the commercial value of their product. The final objective is that these devices should operate on a cost-effective and selffinancing basis. A vast investigation was carried out on the facilities and existing needs before setting up the classification system. The project's executing agency is Wakefield Inspection Services, a world-leading company in the field of cotton control The Procoton programme: improving productivity and marketing by supporting producer associations The CFC, in conjunction with the ICAC/CCIC, is financing a 5-year project for , with a budget of $0.85 m /CFC/ICAC/44. The objective of the Procoton project is to increase the incomes of small cotton producers by improving the social, economic and environmental conditions of cotton production. The Procoton project is a two-year framework project from which are derived even the smallest projects implemented in various countries and from various continents. The basic approach is to help producer organizations via technical support, make access to funding and to the market easier and carry out capacity-building activities. The project has been implemented since October Tanzania and Zambia are the countries selected to start the activities in Africa Integrated Regional Cotton Plant Protection Programme in Africa (PR-PICA) Although not a part of programmes currently funded by donors and therefore not in the WTO chart on cotton development aid, it appears useful to mention the Integrated Regional Cotton Plant Protection Programme in Africa (PR-PICA). The PR-PICA puts together cotton companies (in charge of production) and research institutes of six African countries: Benin, Burkina, Côte d Ivoire, Mali, Senegal, Togo and 6 of the 8 States of the UEMOA including the key cotton producer countries of West Africa. Since 2005, it succeeded the Project for Regional Prevention and Management of Resistance of Helicoverpa armigera to pyrethrinoïds (Projet Régional de Prévention et de Gestion de la Résistance à Helicoverpa armigera) in West Africa (PR-PRAO), implemented from 1998 to The PR-PICA extended the activities of the PR-PAO to these new issues as regards the 55 P a g e

56 integrated protection of cotton plants, management of soil fertility and reinforcing the capacities of all the actors in the cotton value chain. The programme coordination is entrusted alternatively to one of the member States. The 8 th PR-PICA assessment meeting was held in Burkina Faso in April The PR-PICA is funded mainly by cotton companies with the support of agri-pharmaceutical companies. A minimal research programme is financed by cotton companies. The PR-PICA is seeking financial partners. It should be noted that, as part of the USAID C4CP project (see 5.5.1) PR-PICA and IFDC have mutualized their Technical Assistance in the Cotton Sector by signing a cooperation agreement in January For more information, a PR-PICA presentation is available For more information on PR-PICA: 56 P a g e

57 6. TRENDS IN THE COORDINATION AND COMMUNICATION OF COTTON PARTNERSHIPS AND ECOSYSTEMS The implementation of the Support programme for the consolidation of the Action Framework for the EU-Africa Partnership on cotton and its PMU, as of August 2013, made it possible to redeploy the coordination and communication actions in the Partnership and in the Orientation and Monitoring Committee, the COS-cotton. This resulted notably in the 18 th, 19 th, 20 th and 21 st meetings of COS-cotton, respectively on 26 November 2013, 2 July 2014; 11 March 2015 and 26 October 2016 as well as five meetings of the Steering Committee (SC). Insofar as the Programme is closely linked to the Action Framework of the Partnership, the meetings of its SC are generally held in tandem with the SC meetings. The 21 st COS-cotton meeting and the 5 th SC meeting were held in in Brussels on the 26 th and 27 th of October This 21 st meeting was an opportunity to review the progress of the finalisation and appropriation of the Pan African Cotton Road Map (PACRM). The main presentations can be found on the COS-Cotton website: for the 21 st meeting of COS- Cotton, and the 5th SC meeting, support-programme-for-the-consolidation-of-the-action-framework-under-the-eu-africa- partnership-on-cotton/. An important role in coordination and communication activities is played by the Regional Cotton Focal Points (UEMOA, ECCAS and COMESA RCFP), whose role it is to: Ensure visibility and monitor the implementation of their regional strategy for the cotton-textile-clothing sector in line with the Programme. In a broader way, implement the COS-cotton decentralisation mechanism. It is necessary to recall that a key recommendation in the external assessment of the Partnership (June 2009) is the decentralisation of COS-cotton so as to bring it closer to its recipients, while keeping a central office in Brussels. The RCFP must therefore contribute to disseminate information on the Partnership and its Action Framework, while ensuring that the initiatives conducted in a given area (both national and regional) take account of the AF and are coherent and synchronised with the regional cotton strategy. The sustainability of RCFPs and their funding caused significant difficulties during the programme, however, affecting its ability to reach its specific objective as well as certain results. These problems were discussed with the RECs (UEMOA/ECOWAS, ECCAS and COMESA) during the 21 st meeting of COS-Cotton. It was finally agreed that each REC would now be responsible for the sustainability of its RCFP, and to remobilize around its regional cotton-textilemanufacturing strategy. The increasingly inclusive nature of COS-cotton's composition should be noted, ever since ECOWAS became a full member during its 20th meeting, and the African Union Commission during its 21 st. 57 P a g e

58 APPENDICES APPENDIX 1: OVERVIEW OF THE EVOLUTION OF COTTON CULTURE IN AFRICA FOR THE 1999/00 TO 2016/17 MARKETING YEARS, BY COUNTRY AND BASED ON THE MAIN REGIONAL ECONOMIC COMMUNITIES (REC)* APPENDIX 2: EC FUNDING, MEMBER STATES AND MULTILATERAL & REGIONAL AGENCIES INVOLVED IN PROJECTS/PROGRAMMES IN SUPPORT OF THE COTTON SECTOR, NOVEMBER P a g e

59 Orientation and Monitoring Committee of the EU-Africa partnership on cotton European Union ACP Group of States APPENDIX 1 Overview of the evolution of cotton culture in Africa,5354 for the 1998/99 to 2016/17 marketing years by country and based on the main regional economic communities (CER) 1.1. Production + classification of producing African countries based on production levels 1.2. Harvested land 1.3. Yield 1.4. Consumption 1.5. Exports * See hereunder the cotton producing countries included in the statistics based on their REC UEMOA: Benin, Burkina Faso, Côte d Ivoire, Mali, Niger, Senegal and Togo ECOWAS: UEMOA countries + Ghana, Guinea Conakry and Nigeria ECCAS: Angola, Burundi, Cameroon, CAR, DRC and Chad COMESA: Angola, Burundi, Egypt, Ethiopia, Kenya, Madagascar, Malawi, Uganda, DRC, Sudan, Zambia and Zimbabwe SADC: South Africa, Angola, Malawi, Mozambique, DRC, Tanzania, Zambia and Zimbabwe 53 Based on ICAC statistical data, October 2016 and Cotton this month, December NB. The data for the 2014/15 and 2015/16 marketing years are ICAC estimates. Data for the 2016/17 marketing year are ICAC projections.

60 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 1.1.Cotton fibre production (in thousands of tons) n Country/ Economic Community 1998/ / / / / / / / / / / / / / / / / / /17 1 South Africa Angola Benin Burkina Faso Burundi Cameroon DR Congo Côte d'ivoire Ethiopia Egypt Ghana Guinea Kenya Madagascar Malawi Mali Mozambique Niger Nigeria Uganda Cent. Afr. Rep Senegal Sudan Tanzania Chad Togo Zambia Zimbabwe UEMOA ECOWAS ECCAS COMESA SADC AFRICA WORLD Percentage Africa/World

61 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Cotton fibre production ( 000 t) in Africa during the and years (by country and regional economic community) (ICAC data, global statistics, October 2016 and "Cotton this month", December 2016 Countries with high production Countries with average production Countries with low production Total ECOWAS Benin Senegal 9 12 Ghana 5 4 ECOWAS 1, Burkina Faso Togo Guinea 3 3 Côte d'ivoire Niger 2 2 Mali Nigeria ECCAS Cameroon CAR 8 8 ECCAS Chad RDC Burundi 2 1 Angola 1 1 COMESA + SADC Tanzania Ethiopia Madagascar COMESA Egypt Zimbabwe Kenya 7 4 SADC Malawi South Africa 18 9 Mozambique Angola* 1 1 Zambia Burundi* Uganda DRC* Sudan TOTAL Africa 1,327 1, Total Africa 1,693 1,363 Total World 26,201 21,026 *These countries are part of two regional economic communities but are not counted twice in the vertical sum. % Africa Country with high production >= T Country with average production > T et <= T Country with low production <= T 61 P a g e

62 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 1.2.Area of harvested cottonseed (in thousands of hectares) n Country/ Economic Community 1998/ / / / / / / / / / / / / / / / / / /17 1 South Africa Angola Benin Burkina Faso Burundi Cameroon DR Congo Côte d'ivoire Ethiopia Egypt Ghana Guinea Kenya Madagascar Malawi Mali Mozambique Niger Nigeria Uganda Cent. Afr. Rep Senegal Sudan Tanzania Chad Togo Zambia Zimbabwe UEMOA ECOWAS ECCAS COMESA SADC AFRICA WORLD Percentage Africa/World P a g e

63 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 1.3.Yields: kg of fibre/ hectare n Country/ Economic Community 1998/ / / / / / / / / / / / / / / / / / /17 1 South Africa Angola Benin Burkina Faso Burundi Cameroon DR Congo Côte d'ivoire Ethiopia Egypt Ghana Guinea Kenya Madagascar Malawi Mali Mozambique Niger Nigeria Uganda Cent. Afr. Rep Senegal Sudan Tanzania Chad Togo Zambia Zimbabwe UEMOA ECOWAS ECCAS COMESA SADC AFRICA WORLD Percentage Africa/World P a g e

64 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 1.4.Cotton fibre consumption (thousands of tons) n Country/ Economic Community 1998/ / / / / / / / / / / / / / / / / / /17 1 South Africa Angola Benin Burkina Faso Burundi Cameroon DR Congo Côte d'ivoire Ethiopia Egypt Ghana Guinea 13 Kenya Madagascar Malawi Mali Mozambique Niger Nigeria Uganda Cent. Afr. Rep. 22 Senegal Sudan Tanzania Chad Togo 1 27 Zambia Zimbabwe UEMOA ECOWAS ECCAS COMESA SADC AFRICA WORLD % Africa/World P a g e

65 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 1.5.Cotton fibre exports (thousands of tons) n Country/ Economic Community 1998/ / / / / / / / / / / / / / / / / / /17 1 South Africa Angola Benin Burkina Faso Burundi 6 Cameroon DR Congo 8 Côte d'ivoire Ethiopia Egypt Ghana Guinea Kenya Madagascar Malawi Mali Mozambique Niger Nigeria Uganda Cent. Afr. Rep Senegal Sudan Tanzania Chad Togo Zambia Zimbabwe UEMOA ECOWAS ECCAS COMESA SADC AFRICA WORLD Percentage Africa/World P a g e

66 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton APPENDIX 2 EC, member states and multilateral & regional agencies funding brought to cotton support projects/programmes, November Current or future funding 2.2. Past funding 2.3. Budget items of the Support Programme for the Consolidation of the Action Framework for the EU-Africa Partnership on Cotton

67 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 2.1. Current or future support actions specific to African cotton: November 2016 "COS-cotton" update Development Community BILATERAL DONOR EUROPEAN COMISSION (EC) PART I ACTIVE AND ONGOING COTTON SPECIFIC DEVELOPMENT ASSISTANCE a Axis *2 Currency Value Operational status b Disbursment status c Beneficiaries Syprobio - Improvements in incomes and food security of producers through diversified organic production systems 4, IP Benin, Burkina Faso, Mali Support to cotton recovery plan (Flex 2008) 2, 3B IP Côte d'ivoire Consolidation of the Action Framework for the EU-Africa Partnership on Cotton M IP All African producers Support income increase of smallholder cotton producers through better quality and access to markets - phase 2 3B IP Tanzania Support income increase of smallholder cotton producers through better quality and access to markets - phase 3 3B IP Tanzania Intercoton Speed up in the law application regarding the rural property sector in the cotton pool IP Côte d'ivoire TOTAL EC France Improvement of productivity and sustainability of farms in cotton areas. Reinforcement of governance of cotton sector within the framework of the institutional reform: strengthening the capacities of the cooperatives and their unions; supporting the interprofessional dialogue; and supporting the development of a concerted policy in cotton areas 2, IP Mali Support for producers and producer organizations, including in cotton IP Benin areas Support for management of Agricultural resources (ASIGRAP), C2D with B IP Cameroon specific component to improve productivity of the cotton sector Support C2D for the cotton sector (road maintainance, harnessed culture, , 3B IP Côte d'ivoire farmers' guidance, strenghtening cooperatives et interprofessiinal support) Fair trade and organic cotton in West Africa PFS West & Central African countries Rural tracks in cotton areas PFS Mali Support to the CMDT for modernisation of its transportation fleet PFS Mali TOTAL France GERMANY Competitive African Cotton Initiative (COMPACI)/Promotion de la production de coton en Afrique subsaharienne Phase II (BMZ ; Pays d'afrique de l'ouest 2,3B,5 IP Fondation Bill&Melinda Gates ; Foundation Aid by Trade 4000 et de l'est (10 pays) 000 ) TOTAL Germany

68 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART I ACTIVE AND ONGOING COTTON SPECIFIC DEVELOPMENT Axis Operational Disbursment Currency Value ASSISTANCE a *2 status b status c Beneficiaries NETHERLANDS Brazil, China, India, Mali, Initiative Sustainable Trade (IDH): Cotton Value Chain Development 2,3B,5 PFS Pakistan, Tajikistan, Turkey TOTAL Netherlands SWEDEN Conservation Cotton TechnoServe Programme: Support to farmers in Northern Uganda to become efficient producers of cotton and staple food crops (in cooperation with jeans manufacturer Edun) IP Uganda TOTAL Sweden TOTAL EU Member States TOTAL EU (EC+Members) Bilateral Donors outside EU AUSTRALIA Business Partnerships Platform: ethical cotton production in Kenya 5 US$ IP Kenya Business Partnerships Platform: improving access to global cotton markets US$ IP for farmers in Pakistan Pakistan TOTAL Australia - U$$ US$ TOTAL Australia SWITZERLAND Initiative Sustainable Trade (IDH): Cotton Value Chain Development 2,3B,5 US$ IP Africa, Central Asia, China Value Chain Development of Organic and Fairtrade Cotton 2,3B, Burkina Faso, Mali, Kirghiz US$ IP Republic TOTAL Switzerland - U$$ US$ TOTAL Switzerland United States C4 Cotton Partnership Programme (C4CP) M US$ IP C4 Reseach Exchange Programme Agreement 3B US$ EC C4 et Sénégal Borlaug Fellowship Programme Research Exchange Programme 3B US$ IP Agreement C4 and Senegal Project RECOLTE for improving the organic cotton value chain. (financing by USDA, Catholic Relieve Services - CATHWEL (CRS) in partnership with UNPCB, INRA and Texas University) 3B US$ IP Burkina Faso TOTAL US - US$ US$ TOTAL US - M SOUTH-SOUTH PARTNER BRAZIL Cotton producing Programme for the development of the cotton sector in Africa M US$ IP countries in Africa Included by WTO mais not recognised as spécific support to African cotton Strengthening of the cotton sector through South-South Co-operation (unaccounted here) M US$ IP South-South cooperation for the promotion of decent work in cottonproducing countries in Africa and Latin America 2, 3B US$ IP TOTAL BRAZIL - US$ US$ Argentina, Bolivia, Colombia, Ecuador, Peru, Paraguay Mali, Mozambique, Paraguay, Peru, Tanzania 68 P a g e

69 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton PART I ACTIVE AND ONGOING COTTON SPECIFIC DEVELOPMENT Axis Operational Disbursment Development Community Currency Value ASSISTANCE a *2 status b status c TOTAL BRAZIL Beneficiaries TOTAL BILATERAL (without EU) - US$ US$ TOTAL BILATERAL (without EU) MULTILATERAL AGENCIES *1 CFC (with ICAC, and co-funding from National cotton classification systems OPEC Fund for Intl' Dev.) 3B US$ IP Kenya and Mozambique CFC (with ICAC and co-funding from ProCotton - Improving Productivity and Marketing through Support to 2, 3B US$ EU and OPEC Fund for Intl' Dev.) Producer Organizations (CFC/ICAC/40) IP Tanzania and Zambia TOTAL CFC - US$ US$ TOTAL CFC FAO Competitiveness and sustainable strengthening of the cotton sector through the reinforcement of cotton farmers' capacities in the Integrated Production and Pest Management 4 2, 3B US$ included in Intra-ACP Programme IP included in Intra-ACP programme Burkina Faso, Mali, Senegal, Tanzania, Zambia TOTAL FAO- $EU US$ 0 0 TOTAL FAO ITC Marketing and promotion of African cotton including quality improvement Bénin, Burkina Faso, Mali, (reduction of contamination) through a close alliance with cotton included in 3B IP Uganda, Senegal, consuming spinning mills in Asia as well as developing low capital-intensive Intra-ACP EC Tanzania, Chad, Zambia fibre transformation technologies in Burkina Faso and Zambia 4 Program included in Intra-ACP EC UEMOA, ECCAS, COMESA Coordination of African Regional Cotton Sector Strategies Implementation Program IP Zambia : Empowering women in the cotton sector (women and trade) 2 US$ IP Zambia TOTAL ITC- $EU US$ TOTAL ITC UNCTAD Project on cotton by-products in Eastern and Southern Africa. COMESA Regional Cotton to Clothing Strategy 5 US$ SFP TOTAL CNUCED - US$ US$ TOTAL CNUCED TOTAL UNIDO - US$ US$ 0 0 TOTAL UNIDO TOTAL Multilateral Ag. - US$ US$ TOTAL Multilateral Ag TOTAL TOTAL US$ US$ P a g e

70 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Note: Exchange rate: $1.20* = 1, for the conversion of USD-denominated funding into Euros b SDP: stage of drafting of future project; CE: in progress *1 Only funding other than the one of the European Commission is taken into account to avoid double-counting. *2 Pillars of the EU-Africa Partnership on Cotton (Note. M = more than 3 pillars are taken into account) 1. Improving capacities for the development, monitoring, assessment and updating of national and regional cotton strategies; 2. Improving the institutional environment of cotton value chains, their internal organization and their efficiency; 3A. Improving external factors for the competitiveness of cotton value chains by decreasing support for cotton from developed producer countries and better market access rules 3B. Improving internal factors for the competitiveness of cotton value chains through access to trade, support to technological innovation and improved productivity 4. Reduced vulnerability of cotton value chains; 5. Increased added value from cotton value chains; 6. Strengthened, effective and efficient coordination at the international, regional and national levels. 70 P a g e

71 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 2.2. Past support actions specific to African cotton: November 2016 "COS-cotton" update Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a BILATERAL DONOR EUROPEAN COMMISSION (EC) All ACP Agricultural Commodities Programme (AAACP): EU-Africa Partnership on Cotton, implemented with CFC, FAO, ITC, UNCTAD and World Bank Axe *2 Currency Value Operational status b Disbursment status c M C Beneficiaries C4 + All African producers European Union Delegation (EUD) Conference on GMO cotton 3B C Support to the functioning of the "Comité d'orientation et du suivi du partenariat UE- Afrique sur le coton" (COS COTON) C C4 + All African producers All African producers Study on the "Université du coton" concept 2 C 2009 All African producers Mid-Term Evaluation of the EU-Africa Partnership on Cotton 6 C 2009 All African producers "Programme d'appui Régional de l'intégration" (PARI) Cotton classification in West Africa All African 3B C producers Rehabilitation of rural roads in cotton areas C Benin Support to the "Association interprofessionnelle du coton" (AIC) (Stabex funding) C Benin Support for national cotton sector/reforms Benin - Budget support (with sectoral conditionalities) C Benin - Institutional support C Benin - Support for national cotton sector/reforms Complementary assistance (evaluation, IP audit) Benin Cotton sector support (recapitalisation of the cotton companies by participation of the cotton producers through a grant to UNPCB) C Burkina Faso FOOD/2007/ "Amélioration de la fertilité des sols dans les exploitations biologiques de la zone cotonnière du Burkina Faso" 3B IP Burkina Faso Support to cotton classing SOFITEX laboratory towards international accreditation ISO17025 (UEMOA Quality Programme, Phase II) 3B IP Burkina Faso

72 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Cotton arrears settlement (debt payments Axe *2 Currency Value Operational status b Disbursment status c C Support to cotton sector reform C Chad Beneficiaries Central African Republic Short-term technical assistance to Ministry of Agriculture (Stabex funding) C Côte d Ivoire Long-term technical assistance to Ministry of Agriculture (Stabex funding) C Côte d Ivoire Cotton arrears settlement (debt clearing) (Stabex funding) C Côte d Ivoire Cotton arrears settlement (debt clearing) (Stabex funding) C Côte d Ivoire Miscellaneous studies (Stabex funding) C Côte d Ivoire Cotton road rehabilitation (Stabex funding) C Côte d Ivoire Support to institutional restructuring (Stabex funding) C Côte d Ivoire Support to animal traction agriculture ("culture attelée") (Stabex funding) 3B C Côte d Ivoire Support to Cotton Producers' Organizations (Stabex funding) C Côte d Ivoire Compensation for farmers and LCCI employees (Stabex funding) C Côte d Ivoire Rehabilitation of "Salle de classement" (Stabex funding) 3B C Côte d Ivoire Long-term technical assistance to Intercoton (Stabex funding) C Côte d Ivoire Seed-production Programme (Stabex funding) 3B C Côte d Ivoire Compensation Workers CIDT (FLEX ) C Côte d Ivoire Support to Cotton Producer Organizations (Flex ) C Côte d'ivoire Roads/tracks rehabilitation in cotton growing areas (Flex funding) C Côte d'ivoire Support to cotton sectoral reform Mali - Fixed tranche C Mali - Variable tranche C Mali - Literacy component C Mali - Rehabilitation of tracks in cotton areas C Mali Compensation en faveur du coton biologique et équitable C Mali National Cotton Institute: extension and technical assistance to smallholders by cotton concessionary companies for crop diversification C Mozambique Institutional building to National Institute of Cotton, rehabilitation of testing laboratories, equipment and vehicle supply 3B C Mozambique National Institute of Agriculture Research: identification, adaptation and multiplication of cotton varieties 3B C Mozambique 72 P a g e

73 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Extension and technical assistance to smallholders by cotton concessionary companies to strengthen cotton farming system Axe *2 3B Currency Value Operational status b Disbursment status c C Beneficiaries Mozambique Cotton quality, diversification, strengthening of producers' organisations (Stabex funding) 2, 3B C Senegal Support to cotton roads rehabilitation Togo - Stabex funding C Togo - Stabex funding C Togo - Stabex funding C Togo Support to the cotton sector Togo - Study on human resources of SOTOCO C Togo -Support to restructuring and consolidation of cotton producers' organizations C Togo - Funding of shares of producers' federation in capital base of SOTOCO C Togo Cotton Training Centre/Cotton Research Institute (STABEX) C Zimbabwe Training and capacity building for small-scale cotton farmers Cotton Training Centre (STABEX) C Zimbabwe Cotton farmers training support (STABEX) C Zimbabwe Cotton farmers training support (STABEX) C Zimbabwe University of Cotton UPB AproCA Subsidy (on convention UEMOA contribution to 9 th EDF) All African IP producers Support income increase of smallholder cotton producers through better quality and access to markets - phase 1 3B IP Tanzania Support to the cotton sector: multipurpose storage facilities 2, 3B C Togo TOTAL EC FRANCE Commodity Risk Management C West African Countries Cotton sector reform C Benin Concessional loan fonds de lissage coton C Burkina Faso Loan to SOCOMA for industrial programme S Burkina Faso Technical & financial support for cotton producers' organizations C Burkina Faso Financing of ginning factory C Cameroon Improve soil fertility and promote no-till system 3B C Cameroon Value chain cotton sector support C Mali 73 P a g e

74 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Beneficiaries Strengthening of regional approach in EU-Africa Partnership: i) launch of a regional platform for biotechnologies and phytosanitary coordination; ii) strengthening and capacity building of producer associations; iii) control of sectoral information management (development of a cotton observatory and structuring of a regional information system on cotton) 2, 3B, IP West & Central African countries Programme de renforcement de la filière coton burkinabé (PRFC-B) - Support for the price risk management mechanism. Support for the organizations of cotton farms and producers. Strengthening of the national structure to deliver adequate services to its members IP Burkina Faso Fair trade and organic cotton IP TOTAL France GERMANY "Cotton Made in Africa" partnership; sustainable cultivation 5 Implementation of EU-Africa website ( in French and English C 2010 C 2006 West & Central African countries African countries All African countries Support to follow-up & coordination of cotton secretariat C Burkina Faso Study on competitiveness and ecological sustainability of different cotton production systems 3B Diversification of cotton production C Chad Public-Private-Partnership for the establishment of a certified organic cotton production S Uganda Public-Private-Partnership organic cotton certification C Uganda Public-Private-Partnership Alafia-Coton biologique et équitable dans la réserve de biosphère de la Pendjari Conservation and NR management - Technical and organisational support to small cotton farmers 5 3B Promotion of cotton value chains in Sub-Saharan African countries (belongs to COMPACI) 2,3B, TOTAL Germany NETHERLANDS Cotton made in Africa C 2005 C 2010 C 2011 C 2012 T Benin Benin Benin Western and Eastern Africa Benin, Sub- Saharan Africa Support to the Ministry of Industry and Commerce (MIC) C Benin Cotton competitiveness enhancement 3B C Benin 74 P a g e

75 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Support to Unions of Communal Cotton Producers (UCPC) C Benin Non-chemical pest management 3B C Benin Strengthening Cotton Producers' Association (PROCOTON) C Benin Support to Unions of Communal Cotton Producers Better Cotton Initiative - BCI - Better Cotton Fast Track Fund - Pays-Bas (IDH), ICCO, Rabobank, secteur privé 2 2,3B, C C Beneficiaries Benin, Burkina Faso, Mali Mali Better Cotton Initiative - BCI 2,3B, C Mozambique Initiative Sustainable Trade (IDH): Cotton Value Chain Development 2,3B, C Africa, Central Asia, China TOTAL Netherlands SWEDEN C All African Better Cotton Initiative countries TOTAL Sweden Germany, Danemark, France, Netehrlands, UK, Sweden, Japan Support for the Cotton Initiative through negotiations at the WTO (implementation by IDEAS) 3A C C4 TOTAL TOTAL EU Member States TOTAL UE (CE + Etats) (1) Bilateral Donor outside EU SWITZERLAND Value Chain Development of Organic and Fairtrade Cotton in Kyrgyz Republic, phase II US$ C Kirghiz Republic Value Chain Development of Organic and Fairtrade Cotton in Burkina Faso, phase II US$ C Burkina Faso Cotton Project - Ensuring a result for African cotton-producing countries, phase III Better Cotton Initiative 2 2,3B,5 US$ US$ C 2013 C C4 and other African countries African countries and others 75 P a g e

76 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community TOTAL Switzerland JAPAN Better Cotton Initiative PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 2,3B,5 Currency Value Operational status b C 2013 Disbursment status c US$ Beneficiaries Brazil, China, India, Mali, Pakistan Capacity building for cotton farmers' organizations (Support through the Japan Social Development Fund in the World Bank) 2 US$ C Mali Soil diagnosis and conservation 3B US$ C Mali Integrated pest management for plant protection II 3B US$ C Senegal Agricultural extension and farmers' cooperatives 3B US$ C Malawi Integrated pest management for plant protection II 3B US$ C Uganda Soil diagnosis and conservation 3B US$ C Tanzania Dissemination of improved seeds 3B US$ C Burkina Faso TOTAL Japon US$ United States Ministerial level capacity building on Science and Technology and Bio safety Training (Specifically requested by the C4) 2 US$ C African countries Cotton Study Tour for C4 Ministers 3A US$ C C4 Cotton classing, soil management and entomologist capacity-building programmes 3B US$ C C4 + Senegal Biotechnology and Biosafety Awareness Workshop 3B US$ C C4 + Senegal Borlaug Fellowship (cotton research on biotechnology) 3B US$ C Burkina Faso TOTAL United States West African Cotton Improvement Programme (WACIP) US$ C C4 + Senegal Cochran Fellowship (training on cotton production and processing methods to increase productivity) 3B US$ C Burkina Faso, Côte d'ivoire, Senegal, Chad Program "Food for progress"/ Bio and Fairtrade cotton 5 US$ C Burkina Faso Cocharan Fellowship Programme - Cotton Classification and Grading: Fellowship Programme of Demonstration Techniques and Technologies Improving Cotton Production Practices Programme US$ US$ C 2015 C 2016 US$ Benin, Chad, Mali, Senegal C4 and Senegal 76 P a g e

77 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community BRAZIL PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Programme for the development of the cotton sector in the Cotton-4 countries (Benin, Burkina Faso, Chad and Mali) Axe *2 Currency Value Operational status b Disbursment status c US$ IP C4 Beneficiaries TOTAL BRAZIL US$ TOTAL bilateral without UE - US$ TOTAL bilateral hors UE - US$ MULTILATERAL AGENCIES * 1 CFC (in partnership with ICAC) CFC (with EU cofinancing) CFC (in collaboration with FAO) CFC (with ICAC and co-funding from EU and OPEC Fund for Intl' Dev.) Cotton warehouse receipts project 3B US$ C Cotton contamination (study) 3B US$ C Mali Sustainable cotton production in West Africa (study) 3B US$ C Commercialisation of instrument testing for cotton (study) 3B US$ C Commercial standardization of instrument testing of cotton 3B US$ C Uganda and Tanzania Burkina Faso, Cameroon, Côte d'ivoire, Mali, Chad, Togo Burkina Faso, Mali, Tanzania Cotton exporters with Mali and Tanzania as African partners Development of Risk Management Strategies for Cotton Producers in Mozambique US$ C Mozambique Improving cotton production efficiency in small-scale farming systems (co-funding EC: US$ 1,0 M) Prévention de la contamination du coton graine en Afrique de l'ouest (co-funding. EC: US$: 3,5 M) US$ IP US$ IP Kenya and Mozambique Burkina Faso, Côte d'ivoire, Mali 77 P a g e

78 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c TOTAL CFC FAO Sub-Regional Programme for Integrated Production & Pest Management (IPPM) through 2, 3B US$ C Farmer Field Schools (FFS) - 40,000 cotton farmers targeted for full-season FFS training Strengthening the Management Capacity of Cotton Cooperatives to engage in value chains (EC AAACP funds)* 2 US$ C TOTAL FAO US$ FAO (with ICAC and co-financed by GIZ) ICAC (in partnership with CFC and USAID) Measuring Sustainability in Cotton Farming Systems. Towards a Guidance Framework (study) 3B US$ IP Workshops on the use of biotechnology in cotton 3B US$ C Beneficiaries Benin, Burkina Faso, Mali, Senegal Kenya, Zambia All cotton producingcountries All African producers TOTAL CCIC US$ ITC 3B C Cotton Cotton Exporters' Guide and online version US$ exporters South-South Trade Promotion for African Cotton 3B C Cotton US$ exporters 3B Malawi, Mozambique, Uganda, Joint ITC/Turkey Cotton Training, Capacity-building and Marketing Programme US$ C 2008 Tanzania, Zambia, ACTIF and ACA 3B Malawi, Mozambique, Including AAACP funding: US$ Joint ITC/Bangladesh Capacity-building and Cotton Marketing Programme* US$ C 2009 Uganda, Tanzania, Zambia, ACTIF and ACA 3B C Ethiopia, Joint ITC/India Cotton Training Programme US$ Malawi, Uganda, Tanzania Joint ITC/China Cotton Training Programme 3B C Benin, US$ Cameroon, 78 P a g e

79 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community Including AAACP funding: US$ PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Joint ITC/China Follow-up Cotton Training Programme 3B US$ C Joint ITC/India Follow-up Cotton Training Programme 3B US$ C Strategy formulation for value added from cotton to downstream products (e.g. clothing) for Common Market for Eastern and Southern Africa (COMESA) and African Cotton Textiles Industry Federation (ACTIF)* 1 US$ C Beneficiaries Côte d'ivoire, Mali Benin, Burkina Faso, Cameroon, Côte d'ivoire, Mali, Chad Benin, Burkina Faso, Cameroon, Gabon, Guinea, Madagascar, Mali, Niger, Senegal, Chad, Togo COMESA, EAC, SADC Fully funded through AAACP Strategy formulation for value added from cotton to downstream products (e.g. clothing) for West African Economic and Monetary Union (WAEMU) and Economic Community of Central African States (ECCAS)* 1 US$ C WAEMU, ECCAS and ACA Including AAACP funding: US$ Joint ITC/China Capacity Building and the Cotton Value Chain for Francophone African Countries, Hebei province, 15 June-5 July 2011 Joint ITC/Viet Nam Value Chain Capacity Building and Cotton Marketing Programme (August 2011)* 3B US$ C US$ C Executive course on cotton trading and marketing ("Cotton School") based on the Cotton Exporter's Guide 3B US$ S S On-line e-learning module for the Cotton Exporter's Guide on cotton contamination 3B US$ C All African producers Kenya, Malawi, Mozambique, Uganda; Tanzania, Zambia, Zimbabwe Cotton exporters in Africa Cotton exporters 79 P a g e

80 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community Including AAACP funding: US$ Including AAACP funding: US$ Including AAACP funding: US$ Including AAACP funding: US$ Including AAACP funding: US$ Including AAACP funding: US$ PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Programme conjoint ITC/Thailande: de renforcement des capacités et de commercialisation du coton en faveur de l'afrique de l'ouest et du Centre* Programme conjoint ITC/Chine de renforcement des capacités et de commercialisation du coton en faveur de l'afrique de l'est * Joint ITC/Thailand Capacity Building and Cotton Marketing Programme for West Africa Joint ITC/Thailand Capacity Building and Cotton Marketing Programme for East and Southern African countries* Joint ITC and India Capacity Building and Cotton Marketing Programme in 2010* Ginners training on the Chinese Market, Quingdao, China April 2010 Joint ITC/Indonesia Capacity Building and Cotton Marketing Programme* Joint ITC/Bangladesh and Vietnam Capacity Building and Cotton Marketing Programme (May 2010)* Axe *2 Currency Value Operational status b Disbursment status c 3B US$ C B US$ C B US$ C B US$ C B US$ C B US$ C B US$ C B US$ C Beneficiaries Benin, Burkina Faso, Cameroon, Côte d'ivoire, Mali, Senegal, Chad, Togo Kenya, Malawi, Mozambique, Uganda; Tanzania, Zambia, Zimbabwe All African producers East and Southern African producers Ethiopia, Kenya, Malawi, Mozambique, Uganda, Tanzania, Zambia, Zimbabwe Malawi, Mozambique, Uganda, Tanzania, Zambia, Zimbabwe Western/Cent ral African countries Burkina Faso, Benin, Cameroon, Chad, Côte 80 P a g e

81 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community Including AAACP funding: US$ Including AAACP funding: US$ Including AAACP funding: US$ TOTAL AAACP funding: 1,165 M US$ (0.896 M ) PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Joint ITC/China (MOFCOM/Agricultural University of Hebei) training on "Cotton Growth and Trade" in China* 3B US$ C Joint ITC/China Value Chain transparency and African cotton marketing (October 2011)* Joint ITC/Turkey training on value addition in the cotton sector (October 2011)* 3B US$ C B US$ C Joint ITC/China Seminar on Cotton Processing and Trade, October B US$ C Joint ITC/China South-South Co-operation Seminar on cotton production and trade, Hebei, China 3B US$ IP TOTAL ITC US$ EU Funding US$ TOTAL ITC (excluding AAACP) US$ Beneficiaries d'ivoire, Mali, Senegal, Togo Western/Cent ral African countries ACA, AProCA, Bénin, Burkina Faso, ECCAS, Mali, Senegal, Togo,WAEMe ACA, AProCA, Benin, Burkina Faso, Mali, Senegal, Togo, WAEMU Central African Republic, Côte d Ivoire, Ethiopia, Malawi, Tanzania, Zambia, Zimbabwe West and Central African countries 81 P a g e

82 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community UNCTAD (in collaboration with CFC, COS-coton, ACP Secretariat, AAACP) PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Pan African Cotton Meeting, June 2011, Cotonou, Benin* US$ C Beneficiaries African cottonproducing countries TOTAL UNCTAD US$ UNIDO Training of 40 Technical Personnel in Benin WAEMU 2 US$ C countries Creation of a Cotton Standard for West and Central Africa WAEMU 3B US$ C countries Installation of Four Instrument Cotton Classification Systems in West Africa and Training of Maintenance Engineers in India 3B US$ C 2006 Côte d'ivoire, Mali, Senegal and Togo Publication of a Cotton Quality Manual in French WAEMU 3B US$ C countries International Training Workshop on Cotton Quality and Standards Organized in 2007 in Bursa and Izmir in Cooperation with the Government of Turkey, IDB and TUBITAK 3B US$ C 2007 Africa, Asia and CIS countries A Comparative Study of India, Turkey and Egypt Aiming to Develop Appropriate Strategies for the Cotton Value Chain in Africa West and Central 1 US$ C 2008 African cotton producing countries A Feasibility Study for WAEMU to Establish Two Funds for Cotton and Textiles WAEMU 5 US$ C countries Benchmarking 11 Sub-Saharan African Countries as a Possible Location for the Setting Up Sub-Saharan of a Cotton Yarn Spinning Plant cotton 5 US$ C producing countries International Training Workshop on Sustainable Cotton Production, 11-22/11/10, Bursa, Turkey African countries, 3B US$ C Bengladesh, Tunisia, Turkey Rehabilitation of a Cotton Classing Centre (EU financing ) 3B US$ C Côte d'ivoire 82 P a g e

83 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Impact Study of the Global Economic and Financial Crisis in Least Developed Countries Manufacturing Industry: the Case of the Cotton Sector in Three Countries of the WAEMU Region Axe *2 Currency Value Operational status b Disbursment status c 5 US$ C Upgrading of 20 cotton enterprises in the framework of the restructuring project for WAEMU countries 3B C Development of South-South Cooperation with India and China US$ S 2008 Assistance to SOFITEX Cotton Classification Laboratory to obtain its international accreditation ISO17025 (WAEMU Quality Programme Phase II) (Financing RIP/EU: US$) Beneficiaries Benin, Burkina Faso, Mali WAEMU countries Sub-Saharan cotton producing countries 2, 3B US$ C Burkina Faso TOTAL UNIDO US$ US$ AAACP Funding TOTAL UNIDO (excluding AAACP) WORLD BANK* 8 Cotton Reform Support 2 US$ C Benin Cotton Seminar 3B US$ C Burkina Faso Implementation of Cotton Strategy M US$ C Chad Agricultural Services and Producer Organizations Project 2 US$ C Chad Agricultural Competitiveness and Diversification Project 3B,4 US$ C Mali Agricultural Service and Producer Organization Support Project (PASAOP) 2 US$ C Mali Cotton Sector Policy Reform in West and Central Africa 2 US$ C TOTAL BM US$ Western and Central Africa TOTAL Agences multilatérales TOTAL Agences multilatérales Publics-Private Partnership, included US$ P a g e

84 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community Fundations (PPP- F) PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c Beneficiaries REGIONAL AGENCIES ADB (+ FAO + WAEMU in partnership) Cotton Multinational Competitiveness Programme M US$ IP Benin, Burkina, Chad, Mali, WAEMU WAEMU component US$ WAEMU Benin component US$ Benin Burkuna Faso component US$ Burkina Faso Mali component US$ Mali Chad component US$ Chad TOTAL ADB - US$ US$ TOTAL ADB Integrated Framework (IF) for technical assistance linked with trade in favour of least developed countries DTIS preparation, including cotton sector analysis 3B US$ C Benin Préparation des EDIC, y compris une analyse du secteur coton 3B US$ C Burkina Faso Préparation des EDIC, y compris une analyse du secteur coton 3B US$ C Chad Préparation des EDIC, y compris une analyse du secteur coton 3B US$ C Mali TOTAL IF US$ JITAP) Cotton sector export strategy 3B US$ C Malawi TOTAL JITAP US$ P a g e

85 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton Development Community TOTAL Regional Ag. - US$ TOTAL Regional Ag. - PART 2 COMPLETED COTTON SPECIFIC DEVELOPMENT a Axe *2 Currency Value Operational status b Disbursment status c US$ Beneficiaries TOTAL GENERAL GRAND TOTAL US$ Note: Exchange rate: $1.30* = 1, for the conversion of USD-denominated funding into Euros b C: completed; S: suspended; I: interrupted. *1 Only funding other than the one of the European Commission is taken into account to avoid double-counting. *2 Pillars of the EU-Africa Partnership on Cotton (Note. M = not attributed) 1. Improving capacities for the development, monitoring, assessment and updating of national and regional cotton strategies; 2. Improving the institutional environment of cotton value chains, their internal organization and their efficiency; 3A. Improving external factors for the competitiveness of cotton value chains by decreasing support for cotton from developed producer countries and better market access rules 3B. Improving internal factors for the competitiveness of cotton value chains through access to trade, support to technological innovation and improved productivity 4. Reduced vulnerability of cotton value chains; 5. Increased added value from cotton value chains; 6. Strengthened, effective and efficient coordination at the international, regional and national levels 85 P a g e

86 Mise à jour novembre 2015 relative au Partenariat Union Européenne-Afrique sur le coton 2.3. Allocations from the Support Programme for the Consolidation of the Action Framework for the EU-Africa Partnership on Cotton. Categories Cotton Facility (PMU operations and short-term expertise mobilization to develop the capacities of African cotton stakeholders Contribution agreement FAO Dissemination of Good Agricultural Practices Contribution Agreement ITC a) Operationalization of regional cotton strategies b) Promote cotton quality, opening up to new markets, and support for local processing EU contributions (in Euros) 2,900,000 2,500,000 3,000,000 Grant agreements 1,500,000 Technical support COS-cotton Brussels (services) 500,000 Communication / Visibility 50,000 Audit 100,000 Monitoring, external assessment 350,000 Unforeseen expenses 100,000 TOTAL 11,000, 000 Source: ACP-EU Programme financing agreement (n REG/FED/ )