Fair trade – but what’s in it for the world?
The fair trade movement, which aims
ensure that fair prices are paid to producers in
developing countries, is one of the true global success
stories recent decades. The International
Fairtrade Certification Mark, a guarantee that producers are getting a fair price, has become one of the
most recognizable logos the world, which
91 percent of customers associate positive
values. When the logo first appeared in the UK, the
country where the largest number of fair-trade products are sold, nobody expected that the number of
certified products would grow from only 3 to over
4,500 in just 18 years. In 2011, people around the
world spent more than 6.5 billion US dollars on fair-
-trade certified goods, signifying a 12 percent increase
in sales from the previous year. This was at a time
when most market segments in the developed world
were still shrinking or
stagnating from the after effects
of the 2008 banking crisis. Over 1.2 million farmers
and workers living in 66 countries benefit from fair-
-trade certification by being able to sell their products
at competitive prices, to ensure sustainability.
Fair-trade initiatives have been growing steadily since the late 1960s, when the fair trade
movement started with only a handful of committed
individuals in the West who believed there was an
alternative to the exploitation of farmers and workers
in the developing world. Fair trade ensures fair prices
for suppliers, as well as payment of a premium that
can be reinvested in the local communities (for example, in schools or sanitation) or in improving productivity. In India, for instance, a group of rice farmers used
the premium to buy farm machinery, which meant a
30 percent improvement in production.
As consumers look for, and recognize, the logo
and purchase fair-trade products, they put
pressure on companies and governments to do more
for global welfare. They also put pressure on supermarkets to sell fair-trade goods at the same price as
conventional products, shifting the extra costs involved from consumers to the corporations that collect
the profits.
Critics of the fair trade movement say it is still
not doing enough. They stress that the key to
long-term development is not in small local improvements, but in moving the developing world from
the production of raw materials into processing them,
which can bring in greater profit.
There are already some signs of this happening. A group of tea growers
in Kenya recently set up a processing factory to deliver the final products directly to their customers in
the West. By switching from the export of raw tea to
boxed fair-trade products, they achieved 500 percent
higher profits.
It is important to realize that, despite all of its
benefits, the fair trade movement has its limitations. Some of the poorest farmers can’t afford to pay
the certification fees required for each fair-trade initiative, while others work for big, multinational employers that are excluded from participating. Fair trade is
certainly a step in the right direction, but there is a lot
more we must continue to do in order to help people
in the world’s poorest regions.