How Would A Trade Deal On Cotton Affect Exporting And Importing Countries?

This paper assesses the likely implications for exporting and importing countries from a trade deal in cotton. The study estimates the price, production and trade effects of reforming cotton subsidies and tariffs under alternative scenarios, with a primary focus on the WTO Doha Round. For a variety of scenarios, the model simulates the prices and quantities that would have obtained in a base year had the policy reforms implied by the given scenario been retroactively applied to that year. Simulations cover ten base years (1998-2007) that not only provide a wide variance in prices and subsidy levels but also reflect recent trends in supply and demand.