Information service of the Pontifical Mission Societies since 1927
Ouagadougou (Fides Service) - There is alarm in Africa for falling prices of cotton the main export for many countries including Burkina Faso. Ouagadougou authorities say, “subsidies granted by countries in the north to their own cotton producers have a negative effect on markets of raw materials and since the meeting in 2003 in Mexico of the World Trade Organisation no progress has been made”.
In recent years African cotton producers have registered increasing losses. The government of Burkina Faso has had to increase the capital of the country's main cotton manufacturer SOFITEX to save it from bankruptcy. A decision which will affect the state budget taking resources destined to other vitals needs such as education and healthcare.
Created in 1979 with 3,300 commercial agents SOFITEX has more employees than any other company in the country. It purchases most of its cotton from local producers who now accuse the company of failing to pay a just price.
The buying price of cotton from the producer dropped from 165 CFA Franc per kg in 2006-2007 to 145 CFA Franc per kg for the 2007-2008 harvest. SOFITEX blames international factors which reduce manufacturers' profit margins: rising prices of fertiliser and oil, poor CFA Franc and Euro exchange rate and developed countries subsidies to their own farmers.
SOFITEX has reduced its management expenses as a gesture of solidarity with cotton producers, the first to be affected by the crisis which risks involving the whole country. About 2 million people in Burkina Faso live directly or indirectly from the cotton industry, the country's main source of foreign currency which contributes 5-10 per cent to the Gross Domestic Product. (L.M.) (Agenzia Fides 26/5/2007 righe 36 parole 378)
