A policy brief from the Groupe d'Economie Mondiale (GEM) of the Institut d'Etudes Politiques de Paris (Science Po) examines the impact that reduced cotton subsidies in rich countries would have on West African producers, and concludes that farmers in this region are poorly placed to take advantage of improved market conditions.

The paper by Ben Shepherd and Claire Delpeuch, entitled Subsidies and Regulatory Reform in West African Cotton: What are the Development Stakes?, notes that there is wide divergence amongst researchers as to the benefits that West African cotton producers will derive from reduced subsidies in wealthier countries.

One key difference amongst the models used to estimate these economic benefits is supply elasticity, which indicates the responsiveness of farmers to changes in world prices. The authors say that this is a key element in determining how African cotton producers will benefit from reduced subsidies and a subsequent rise in world market prices.

While changes are underway in Western African countries to make cotton producers more price responsive, the authors say that much more needs to be done, particularly in Mali. The authors recommend regulatory reform that aims to bring producer prices more closely into line with world prices, improves cotton sector productivity, and brings farmers into more direct contact with the world market.