U.S. cotton exports to RI not at risk after Aussie pact
U.S. cotton exports to RI not at risk after Aussie pact
WASHINGTON (Reuters): U.S. cotton exports to Indonesia will not waiver even though Australia is providing trade assistance for its own exports to the Asian country, industry officials said Wednesday.
If anything, such a move may help U.S. markets if it boosts the economy in Indonesia, Neal Gillen, Executive Vice President of the American Cotton Shippers Association, said.
"It'll help Indonesia, and by helping Indonesia, in the long run, it helps everyone," he said.
Other experts said that U.S. cotton exports are doing so well despite the Asian financial crisis that the Australia agreement will not put a dent in U.S. sales.
"The U.S. is having a great year in terms of exports," Terry Townsend, statistician with the International Cotton Advisory Committee, said.
The Australian government announced Wednesday that it will underwrite exports to Indonesia through its Export Finance and Insurance Corp. The move was partly prompted by U.S. export credit programs to Asia, which Australia has said are aggressive maneuvers to increase U.S. farm exports.
The United States has offered $400 million in short-term GSM- 102 credits on sales to Indonesia. So far, only $2.13 million has been recorded for cotton sales, a U.S. Agriculture Department aide said.
U.S. cotton exports to Indonesia accounted for approximately 8 percent of total U.S. cotton exports in the 1996/97 marketing year when the United States exported 510,900 480 lb-bales to Indonesia, another USDA aide said.
Australia, however, exports more than one-quarter of its cotton to Indonesia, Townsend said.
Complaint
Australia would consider complaining to the World Trade Organization (WTO) over the aggressive trade push into Asia by the U.S. through an exports credit scheme, Prime Minister John Howard said in Canberra yesterday.
"I don't rule anything out," Howard said when asked if he would take matters to the WTO, the world's trade governing body.
"The Americans have not been reluctant to take us to the World Trade Organization. The Americans played hardball over Howe Leather, and the Australian government's first responsibility is to protect the interests of Australian jobs and Australian exporters," Howard told reporters.
Australia was forced to revamp its assistance to Melbourne- based car upholstery firm Howe Leather last year after Washington complained to the WTO.
The U.S. is offering about US$2 billion in export credits to financially-stricken Asian countries to help them buy U.S. farm products.
On Wednesday, Howard called the U.S. export scheme "actively avaricious", citing it as a reason for his decision to extend Australia's export underwriting package to include Indonesia.
That line was backed by industry. Cotton Australia chief executive Gary Punch said the U.S. Department of Agriculture (USDA) was "behaving like looters after a cyclone in the Indonesian market".
On Thursday, Howard said the government was gathering evidence about what the Americans were doing, and would then consider its response.
Howard also said Canberra had not yet decided if the U.S. scheme breached WTO rules.
"That's something that we're assessing," he said.