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Unformatted text preview: Databases selected: Multiple databases... Full Text (596 words) World News: U.S. Loses Ruling On Cotton Payouts Peter Fritsch , John Lyons . Wall Street Journal . (Eastern edition). New York, N.Y.: Sep 1, 2009. pg. A.6 Abstract (Summary) Brazil, the world's biggest exporter of coffee, sugar, beef, chicken and iron ore, imports $18 billion a year of American goods and has long complained that many of its products face unfair obstacles to the U.S. market. (c) 2009 Dow Jones & Company, Inc. Reproduced with permission of copyright owner. Further reproduction or distribution is prohibited without permission. A ruling against the U.S. in a long-running fight with Brazil over American payouts to cotton growers sets an important precedent for developing nations concerned by what they see as excessive U.S. support for farmers. A World Trade Organization arbitration panel ruled Monday that Brazil is entitled to $295 million upfront, and nearly $150 million a year, for the U.S. failure to eliminate subsidies to the cotton industry. The annual penalties are far below the $2.5 billion Brazil had sought. But the ruling opened an important door to retaliatory measures that, under certain circumstances, could punish American pharmaceuticals companies and other owners of intellectual property. The WTO panel said Brazil could target other American goods for retaliation if U.S. cotton supports rise significantly beyond current levels for its 25,000 farmers. Brazil, which has a robust pharmaceuticals and generic-drug industry, has targeted patented U.S. drugs for potential retaliation. That means the country could allow domestic drug makers to manufacture copies of U.S. pharmaceuticals that are still under patent protection. The issue of "cross retaliation" in global trade disputes is contentious. Many smaller countries need U.S. capital goods in order to grow, leaving them without effective tools to fight back with when the WTO finds that U.S. trade policy has injured the smaller nations. The WTO cotton ruling for Brazil is, therefore, "the big banana in terms of smaller countries having effective means of retaliation," said Gary Hufbauer, a trade expert at the Peterson Institute for International Economics in Washington. "This will cause the intellectual-property community a few shakes and quivers." Small nations such as Ecuador and Antigua and Barbuda have sought the right to retaliate against the U.S. over trade in bananas and Internet gambling, respectively. But they don't have the wherewithal to make life uncomfortable for American companies -- at least not without hurting their own importers at the same time....
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This note was uploaded on 11/29/2010 for the course PSC 222 taught by Professor Jing during the Spring '10 term at Rochester.
- Spring '10