Barking Up the Wrong Tree: Agricultural Subsidies, Dumping and Policy Reform

World trade talks have foundered recently, in part due to developing country demands that industrialised countries reduce their large farm support programmes to allow poor farmers in the global South to compete more fairly. But are subsidies really the problem? For some crops – most notably cotton and sugar – Northern subsidies clearly are a root cause of low international prices and unfair competition. In its victorious WTO claim against US cotton subsidies, Brazil showed that eliminating subsidies would reduce US production 29 percent, US exports 41 percent, and this would lead to a rise in international prices of 13 percent.