Thoughts and views from a member of the IEG team.
Tradeblog

December 14, 2005

Trading In Cotton

There was an interesting feature on the news yesterday.  It was a look at cotton farming in the States and Africa.

The American farmers are subsidised by their government and so can afford to flood the market with cheap (and, it must be said, high quality) cotton, effectively pricing out third world farmers.  But what really struck me was the difference in technology levels.

They showed the American farmer mowing down acres of cotton fields with a huge mechanical harvester; then gave us a shot of a number of Africans happily compressing (hand-picked) cotton with their feet, accompanied by some traditional chants.

Charmingly rustic as the Africans were, they just can’t compete.  One of those harvesters apparently collects more cotton in a day than an African farmer can in a lifetime.  And if the subsidies were stopped it’s countries like Brazil that would fill the gap not Africans.

Clearly ensuring that goods are sold at a fair price is just one factor that needs to be addressed in the fight against poverty in Africa.

To grab a bigger share of world trade Africans will need to increase volumes, improve manufacturing processes and raise standards.   And the best way forward is a balanced combination of external technological help (for the short term) and home-grown innovation.
           

 

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