The Société cotonnière du Tchad, also called Cotontchad, is a

parastatal A state-owned enterprise (SOE) is a business entity created or owned by a national or local government, either through an executive order or legislation. SOEs aim to generate profit for the government, prevent private sector monopolies, provide goo ...

Chadian company operating in a monopoly regime that buys and exports all the

cotton Cotton (), first recorded in ancient India, is a soft, fluffy staple fiber that grows in a boll, or protective case, around the seeds of the cotton plants of the genus '' Gossypium'' in the mallow family Malvaceae. The fiber is almost pure ...

produced in

Chad Chad, officially the Republic of Chad, is a landlocked country at the crossroads of North Africa, North and Central Africa. It is bordered by Libya to Chad–Libya border, the north, Sudan to Chad–Sudan border, the east, the Central Afric ...

. Cotton represents 40% of the country's exports and in past years has been even more dominant. It was created in 1971 from the nationalisation of the Franco-Belgian society Cotonfran and had the task to collect, buy, gin, transport and export the cotton crop. At present the state owns 75% of the company, the French Textile Development Company (''Compagnie Française pour le Développement des Textiles'' or CFDT) 16%, a consortium of Chadian banks 6% and the

French Development Agency The French Development Agency (, AFD), known from 1992 to 1998 as the Caisse Française de Développement (CFD, ), is a public financial institution that implements France's development and international solidarity policies. It works to fight pov ...

2%. The CFDT's main role is to market Chad's cotton on the world market, while private banks provide the credits necessary to Cotontchad and to the peasants to finance the opening of each planting season and especially to provide capital for the import and distribution of fertilisers and insecticides. Originally the producers were protected from market fluctuations by the Cotton Price Stabilization Board (''Caisse de Stabilisation des Prix du Coton'' or CSPC), created in 1968, whose task was to stabilise prices paid to peasant producers by funding operating losses incurred by Cotontchad. Assuring a constant price to the producer not only helped maintain a certain level of production for Cotontchad but also limited costs to the company by holding down producer prices. But the recession that hit the cotton market between 1991 and 1993 drastically reduced the activities of the company and led to the abolition of the CSPC in 1993 and the decision to let the prices of the cotton bought by the producers fluctuate freely, following the market. Notwithstanding, economic difficulties have continued to hamper the company to the point that its privatisation is often discussed.

References

Companies of Chad Economy of Chad Government of Chad Agricultural organisations based in Chad Cotton {{Chad-stub