What is Fair Trade?
Fair Trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing their rights of, disadvantaged producers and workers – especially in the South. Fair Trade organizations (backed by consumers) are actively engaged in supporting producers in awareness raising and in campaigning for changes in the rules and practices of conventional international trade.
Fair Trade's strategic intent is:
* Deliberately to work with marginalized producers and workers in order to help them move from a position of vulnerability to security and economic self-sufficiency.
* To empower producers and workers as stakeholders in their own organizations;
* Actively to play a wider role in the global arena to achieve greater equity in international trade.
Impact Areas
Beyond the Fair Price
The concept of Fairtrade, however, goes far beyond a simple economic transaction. What is at the heart of Fairtrade is that buyers and producers build long term partnerships. Unlike aid, which is dependent on donors, Fairtrade offers a more sustainable way for farmers, workers and their families to improve their livelihoods.
Better living conditions
The social, working and living conditions of the producers, the workers and their families are considerably improved over time. The benefits often extend to the entire community, which thanks to the Fairtrade Premium can actively impact upon the lives of individuals: improve health services, provide medical supplies, build community stores for low-priced staple foods, provide educational facilities and extend educational opportunities for children. For example, the Costa Rican coffee cooperative consortium COOCAFE uses Fairtrade revenues to fund improvements in 70 local schools and has already provided 6,700 scholarships to students so they can attend high school and university.
Environmental Sustainability
Fairtrade farmers and workers respect the environment and are encouraged to engage in sustainable methods of production. Farmers implement integrated crop management and avoid the use of toxic agrochemicals for pest management. Nearly 85 percent of Fairtrade certified coffee is also organic, which is better for the environment and for the health of the workers.
Access to international markets
For small and marginalised producers it is very difficult to access international markets. They lack access to information, infrastructure and influence on market price or tariff rates. Fairtrade helps producers to gain a better understanding of international markets. It provides the producers with contacts and mobilises resources to present the products at international fairs. Last but not least, Fairtrade helps to build capacity and confidence to sell Fairtrade products also on the conventional markets. Read about the Surin rice Fund Cooperative in Thailand and its success.
The empowerment of women
Important investments can be made in women’s income generating activities that are not related to the farm, thereby strengthening their income, business experience and position in the family. This has taken place in ‘Las Hermanas’ for example, a women’s cooperative founded by the Soppexcca coffee cooperative in Nicaragua, where 184 women own their own plots of land and commercialize their produce internationally. Read about the successful initiative of female workers in a Fairtrade tea plantation in India.
Long-term investments
Long-term investments in pension schemes, life insurance, loan schemes for business development, income diversification schemes etc. can be financed. Read about the achievementsof the Heiveld tea cooperative in South Africa.
Overcoming racial discrimination
One of the aims of Fairtrade is to promote equal rights amongst different ethnical groups and to overcome racial discrimination. For instance, in South Africa the Joint Body is promoting entrepreneurship because it is linked to the governments program to make black workers co-owners of plantations owned by whites. Plantations must be at least 25% black-owned to enter Faitrade.
Community solidarity
The Fairtrade system has been criticised for singling out producer groups that enjoy fair trading conditions while their neighbours or colleagues need to continue working under poor conditions. But research has shown that benefits of the Fairtrade system often spill over and solidarity with other disadvantaged but non-Fairtrade producers can increase. For example, in Indonesia, Fairtrade revenues made it possible for members of the Gayo Organic Coffee Farmers Association (PPKGO), in Aceh to provide humanitarian aid for victims of the devastating earthquake and tsunami that hit the region in December 2004. PPKGO supplied eight truckloads of food for disaster victims, and cooperative members led teams of volunteers in the relief effort.
Ensuring labour rights
Thanks to Fairtrade, workers take on a more active role on the farm, plantation or factory where they are working. They are more involved in the business practices and more aware of their rights. It is often also the first time that they become part of a trade union in order to defend their rights. They also gain experience in dealing with the premiums, such as handling banks, making decisions on how to best spend the money and how to organise themselves. Teresa Wanjiru Muki Ri, a grader in the pack house of Flower Panda, a Fairtrade flower farm in Kenya explains “I have been paid my pro-rata leave dues and I am benefiting from a provision of free basic medical cover. I have also learnt about freedom of association which I was not really aware of before”.
A stronger business approach
Last but not least, Fairtrade enables stronger organisations to develop, which are more experienced in accountancy, business planning, literacy etc. It also improves the quality of the product and provides better access to international markets (also to non-Fairtrade markets for high quality products) through the establishment of long-term trading relationships.
Source: http://www.fairtrade.net/
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