|What is Fair Trade?|
What is Fair Trade
The problems experienced by poor producers and workers in developing countries differ greatly from product to product. The majority of coffee and cocoa, for example, is grown by independent small farmers working their own land and marketing their produce through a local co-operative. For these producers, receiving a fair price for their beans is more important than any other aspect of a fair trade. Most tea, however, is grown on estates. The concerns for workers employed on tea plantations are fair wages and decent working conditions.
To address this there are two sets of generic producer standards; one for small farmers and one for workers on plantations and in processing factories.
The first set applies to smallholders organised in co-operatives or other organisations with a democratic, participative structure.
The second set applies to organised workers, whose employers pay decent wages, guarantee the right to join trade unions and provide decent housing, where relevant. On plantations and in factories, minimum health and safety as well as environmental standards must be complied with, and no child or forced labour can occur.
Fairtrade is also about development. Therefore, the generic standards distinguish between minimum requirements which producers must meet to be certified Fairtrade.
Progress requirements also encourage producer organisations to continuously improve working conditions and product quality, to increase the environmental sustainability of their activities and to invest in the development of their organisations and the welfare of their members or workers.
Trading standards stipulate that traders must:
- pay a price to producers that covers the cost of sustainable production and living
- pay a premium that producers can invest in development
- make partial advance payments when requested by producers
- sign contracts that allow for long-term planning and sustainable production practices.
The Fairtrade Foundation, with its international partners, checks that approved products continue to meet these criteria.
How does it work for Producers
Fairtrade Labelling Organisations International (FLO) is the umbrella organisation uniting the 17 national initiatives including the Fairtrade Foundation. FLO acts as a certification body, setting Fairtrade standards, and monitoring the producers to ensure that they meet the standards and that individual producers are benefitting from the Fairtrade arrangements.
The Fairtrade Mark
The FAIRTRADE Mark is a certification label awarded to products sourced from the developing world that meet internationally recognised standards of fair trade.
By participating in Fairtrade, producers are able to use the additional income to strengthen their organisations and invest in social, environmental and business improvements. Just as importantly, they are able to learn more about markets and marketing, and take more control of their lives.
Workers and management on plantations that participate in Fairtrade work together to make decisions about social development on the plantationm, including the uses to which the extra income is to be put.
What is the History of Fairtrade?
The first Fairtrade label was launched in 1988 in the Netherlands and applied only to coffee. It was a specific response to the collapse of the world coffee price, which fell for some years to far less than the cost of production, and led to much suffering for coffee farmers and their families.
Since then, labels have been launched in 16 other countries, in Europe, North America and Japan, and the products have gained between 1% and 14% market share.
In the UK, the first FAIRTRADE Mark products appeared in 1994 (chocolate, coffee and tea) and, from a small base, sales are still expanding rapidly - by around 40% per year.
Why a Label?
Unlike the various ethical or socially responsible trade arrangements, Fairtrade can only work if consumers are willing to select Fairtrade products in the supermarkets and elsewhere.
The FAIRTRADE Mark is both a tool to attract consumers attention, and a guarantee to the consumr that Fairtrade standards really have been met. Without such an external assurance - and without agreed international standards - any company could lay claim to fair trade.
The FAIRTRADE Mark creates a level playing field; an external standard below which companies cannot drop, allowing competition to operate without damaging the poor producers at the end of the supply chain. Each year more organisations and individuals join the campaign to bring Fairtrade into the mainstream.