Fairtrade
Fairtrade is an alternative approach to conventional international trade. It aims to improve the livelihoods and well-being of producers by improving market access, strengthening producer organisations, paying a better price and providing continuity in trading relationships. It involves building trading partnerships which aim towards sustainable development for excluded and disadvantaged producers. Fairtrade is based on a clear set of internationally agreed standards, which are set by the Fairtrade Labelling Organisation (FLO) and independently assessed and monitored.
Fairtrade seeks to provide better trading conditions by the following means:
- Fair price - a fair price is paid that covers the cost of production, and is guaranteed to be above the world price. If a crop price collapses on the world market, growers are protected and have stability allowing them to plan ahead.
- Additional premium - an additional sum is paid on top of the price, which producers can decide how to spend. It can be used to improve local conditions (e.g. building a school) or reinvested in the business. Producers must belong to democratic organisations (usually co-operatives) which decide how to spend the premium.
- Longer-term - there is a promise of a longer term trading contract, which makes it much easier for farmers to plan for the future. They can also get loans from banks more easily when they can guarantee a continued income.
- Labour standards - Fairtrade suppliers must agree to follow internationally agreed labour standards. They must recognise trade unions, provide decent working conditions, and not discriminate on the basis of gender.
'Fairtrade' has been growing over the past decade, involving larger numbers of producers in poor countries, and increasing types of products. The focus of Fairtrade was originally on agricultural commodities (e.g. coffee and tea) which have the most widespread impact on the livelihoods of small producers in the developing world. More products are following year by year such as fruit, honey, sugar, nuts, beer, wine, fruit juice, snack, roses and footballs.
Fairtrade organisations aim to raise awareness among consumers of the negative effects of international trade on producers, so that they can choose to buy goods that are fairly traded. They also campaign for changes in the rules and practice of conventional international trade, to benefit poor farmers.