Part of the money is invested in the development of the local community
Posted On July 25, 2020
The principles of Fair Trade are simple: producers receive a fair payment agreed jointly, not imposed, allowing to cover production and maintenance costs, working conditions are safe, and production takes place with respect for the environment. There is no discrimination against women or ethnic minorities, and no slavery or child labor. Part of the money is invested in the development of the local community, e.g. building a school. Why is it worth buying Fair Trade?
Fair Trade shopping is a form of combating modern slavery: failure to respect workers’ rights, excessive work in dangerous and unsanitary conditions, starving wages, and child labor. Fair Trade is a good way to help communities in developing countries. Instead of giving alms, we give jobs, a dignified way to break out of poverty. We also buy good quality products, because Fair Trade is usually associated with an ecological method of production.
Instead of giving alms, we give jobs
Food products are produced according to the principles of ecological agriculture, cotton for the production of clothes comes from organic farming. Fair Trade clothes, jewelry and accessories are carefully designed and hand-made.
Does fair mean more expensive?
Price may be a factor that limits the popularity of fair products. Fair Trade products are usually more expensive – but in fact we pay what the item is really worth. For conventional products, retailers’ profits are disproportionately high and the real costs are passed on to the local community. It is worth remembering that Fair Trade products are high-quality goods and there is no point in comparing them to the cheapest industrial food or clothes. Prices are also influenced by demand – the smaller the sales, the higher the prices.
That is why in Poland the disproportion of prices between fair and conventional products is still greater than in Western Europe and the United States. “Fair Trade is a trade partnership based on dialogue, transparency and respect that seeks to achieve greater equality in international trade. It contributes to sustainable development by offering better trading conditions and protecting the rights of marginalized producers and hired workers, especially in the poor South. Fair Trade Organizations (consumer and consumer assisted) are actively involved in supporting producers, raising awareness and campaigning to change the rules and practices of conventional international trade. ‘ It is one of the trends of the social economy.
Does fair mean more expensive?
Thanks to the idea of fair trade, the idea of solidarity between the consumer and the producer is realized, the rights of both are respected, therefore it is a win-win relationship, where the benefits are shared by both parties. Just talking about the idea of Fairtrade is not enough. Fair Trade Organizations and Producer Organizations collect hard data on how Fairtrade changes communities and how it affects farmers, workers and producers.
Estimating the impact of the Fairtrade system on producers in the global South is a complex matter. It is necessary to take into account not only direct purchase rates (i.e. the price for the product), but also factors such as increasing business efficiency, local community development, education, and environmental protection in the context of local and national conditions.
Fairtrade International produces an annual report on the impact of the Fairtrade system on small farmers and wage earners. Its fourth edition was released in 2013.
According to data from FLO-CERT, an organization dealing with the certification of Fairtrade producers, in 2012 there were 1.25 million people registered in the Fairtrade system, of which 1.07 million were small farmers and 168 thousand. are wage earners. 59% of them live in Africa, 24% in Latin America and 17% in Asia and Oceania. Nearly half of the producers of Fairtrade certified products are located in Latin America. The country with the highest number of farmers affiliated to Fairtrade cooperatives is Kenya (14% of all farmers).
In 2010, Fairtrade producer organizations from the global South sold products for a total of EUR 664.5 million. The four products that accounted for 87% of the sales value of all Fairtrade products were coffee, bananas, cocoa and flowers. In addition to funds from the sale of products, organizations that operate under the Fairtrade system received EUR 61.1 million in the Fairtrade bonus (on average, the farmer accounted for around EUR 50). This is an increase of 19% compared to the previous period. 80% of this amount went to cooperatives associating small producers.
According to the data provided by the producers, as much as 53% of the funds from the Fairtrade premium were allocated to improving the quality and efficiency of production.
As a result, they gain an economic advantage in an increasingly competitive market, which translates into increased independence. This tendency is especially visible in small cooperatives. As part of the Fairtrade system, since 2011, 25% of the Fairtrade premium is reserved for activities that improve the quality of the coffee grown. It is a model that can be extended to other Fairtrade products in the future.
Other priorities when using the Fairtrade bonus:
- investments that benefit the local community (sewage, electricity, etc.)
- education of children, but also adults
- environmental protection (ecological certification)
- cash payout to cooperative members (especially in the case of rising living costs)
- gender equality
It is also worth noting that 80% of all cooperatives operating under the Fairtrade system invest in other certificates, such as environmental certificates, to increase their competitiveness on the market.
In the case of salaried workers (for example working in banana plantations), the bonus is mainly used to directly support the workers. But this is not always the case. For example, the most important concern for banana producers in Colombia is productivity gains due to increased competition. For this reason, 1/3 of the Fairtrade Premium has been allocated to this goal. From these funds, among others, soil testing, modernization of the irrigation system and banana packaging. children’s work One of the priorities of the entire Fair Trade movement is to respond to cases of slave labor, including child labor.