Fair Trade
What is Fair Trade?
Fair Trade is a trading relationship, based on dialogue, transparency and respect, that seeks greater equity in international trade between producers in developing countries and businesses and consumers in more developed areas around the world. The Fair Trade system ensures that people along the supply chain receive fair wages, that workers and communities are treated with dignity and producers take steps to preserve the environment. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers throughout Latin America, Africa, Asia and other parts of the world.
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.
Best Resource! http://www.fairtraderesource.org/learn-up/faq/
How Does it Work?
Fair Trade is a partnership between consumers and producers that gives consumers an opportunity to shop ethically and have a direct impact on communities around the world. Through conventional trade, many small scale farmers and artisans in low income countries are exploited in the international market and don’t receive fair prices for their work. There is a prevalence of child labor and slave like working conditions that often goes unnoticed. Fair Trade is a more ethical trading system that works with democratically ran cooperatives and Self Help Groups who are certified by international accredited organizations according to Fair Trade principles and healthy working conditions. Producer groups undergo a thorough audit, as well as do Fair Trade businesses in the West who work with the groups and help to sell their products. There is transparency and accountability along the supply chain that ensures the products that you find in your local grocery that are Fair Trade certified guarantee sustainable living wages for the producers who made them. Your participation is essential to maximizing the power of Fair Trade.
Your purchase of Fair Trade products empowers women and helps producers take control of their lives. Join this people powered solution to global economic injustice today by buying Fair Trade.
Key Fair Trade Players
Fairtrade Labelling Organizations International (FLO), Germany
Independent certification body that sets international Fair Trade standards, strategy and monitors producer and trader compliance.
FLO sets four standards for trader organizations which stipulate that traders who buy directly from Fair Trade producer organizations must:
- Pay at least a price to producers that at least covers the costs of sustainable production (the Fairtrade Minimum Price)
- Pay a premium that producers can invest in developmeent (the Fair Trade Premium)
- Partially pay in advance, when producers ask for it.
- Sign contracts that allow for long-term planning and sustainable production practices
Trans Fair USA
Third party certifier of Fair Trade agricultural products in the U.S. for traders. TransFair USA licenses companies to display the Fair Trade Certified label on products that meet strict international Fair Trade standards. Fair Trade Certification is currently available in the U.S. for coffee, tea and herbs, cocoa and chocolate, fresh fruit, flowers, sugar, honey, rice, and vanilla.
Fair Trade Federation (FTF), USA
The Fair Trade Federation is the trade association composed of retailers and wholesalers in the U.S. fully committed to promoting Fair Trade handicrafts, food and products.
- Providing fair wages in the local context
- Supporting safe, healthy, and participatory workplaces
- Supplying financial and technical support to build capacity
- Encouraging environmental sustainability
- Respecting cultural identity
- Offering public accountability and transparency
- Building direct and long-term relationships
- Educating consumers
World Fair Trade Organization (WFTO), The Netherlands
Global network of Fair Trade producers, traders and support organizations certified and dedicated to Fair Trade principles; Includes regional Fair Trade networks in Asia, Latin America, Africa, Europe and the Pacific Rim that certify producer groups and coordinate Fair Trade activity
The World Fair Trade Organization has 10 standards for its members:
- Offering Opportunities for Economically Disadvantaged Producers
- Offering Transparency and Accountability
- Building Capacity
- Promoting Fair Trade
- Supporting the Payment of a Fair Price
- Supporting Gender Equity
- Fostering Safe and Healthy Working Conditions
- Ensuring No Forced Child Labor
- Promoting Responsible Environmental Production
- Fostering Trade with Concern for the Social, Economic and Environmental well-being of Marginalize Small Producers which does not Maximize Profit at their Expense
Top 10 Reasons to Support Fair Trade
- Fair Trade ensures that farmers and artisans receive a fair price for their products and safe working conditions are met.
- Fair Trade invests in community development and strengthens people and communities.
- Fair Trade provides financial and technical assistance to farmers and artisans to improve production.
- Fair Trade promotes environmental sustainability.
- Fair Trade promotes gender equality in pay and working conditions.
- Fair Trade promotes economic sustainability through direct and long-term relationships between pro ducers and consumers.
- Fair Trade mobilizes communities to make collective decisions about how to spend their funds through worker owned and democratically ran cooperatives.
- Fair Trade provides equal opportunities for all people and gives producers a greater voice in the interna tional market.
- Fair Trade enhances cross-cultural understanding and creates a closer link between consumers and producers.
- Fair Trade is the alternative to ending hunger and poverty today.
Fair Trade Resource Network
The Fair Trade Resource Network is an information hub for education and discussion of Fair Trade, with the goal of raising consumer awareness and helping grow the Fair Trade movement in the U.S.
OxFam Make Trade Fair Campaign
Oxfam America is an international relief and development organization that creates lasting solutions to poverty, hunger, and injustice. They have a large Make Trade Fair Campaign that exposes the exploitation in trade and advocates for fairer practices.
United Students for Fair Trade (USFT)
USFT is a national network of 150 affiliate student organizations advocating around Fair Trade principles, products, and policies.
Fair Trade Towns USA
The Fair Trade Resource Network is an information hub for education and discussion of Fair Trade, with the goal of raising consumer awareness and helping grow the Fair Trade movement in the U.S.
Green America
Green America is a nonprofit membership organization working to harness the strength of consumers, investors and businesses in creating a socially just and environmentally sustainable society. They create the National Green Pages.
How do I know if a product is fair trade certified?
Fair Trade Certification is a guarantee for both consumers and producers that Fair Trade criteria are being followed. When the “Fair Trade Certified” label appears on a bag of coffee or bananas, it signifies that TransFair USA has tracked the product from a certified Fair Trade cooperative to certified US importers, verifying that the Fair Trade price was paid and other Fair Trade criteria were met. The Fair Trade Labeling Organizations International (FLO) is responsible for on-site certification and monitoring of producer cooperatives. Based in Germany, FLO brings together 17 National Initiatives, including Transfair USA, which certify Fair Trade commodities in their respective countries. Transfair USA works with the fair trade retailer or business to ensure that the producers needs are being met with a fair wage, working conditions and advancement programs. The FLO, on the other hand, works more closely with artisans and farmers to address their needs.
Fair Trade provides…
A Fair Price for Products
The main aim of Fair Trade is to increase producer’s incomes. This is achieved through paying a guaranteed fair price and by reducing the number of traders between the producer and consumer so that the producer receives a larger share of the price of the product.
A Fair Trade minimum price is calculated to cover the costs of sustainable production and a sustainable livelihood, and is paid to the producer. Even if the normal price for their product has dropped, the producer is guaranteed to receive this minimum price to continue to support their business and families.
For Fair Trade certified food products, this price is set by the Fair Trade Labeling Organization (FLO). For coffee, a floor price of $1.26 per pound is set. For other certified products, such as bananas, the price attempts to cover the cost of production and provide farmers with a decent standard of living. For craft items and other non-certified products sold by members of the Fair Trade Federation, a living wage is paid in the local context.
Invests in People and Community Development
There is a separate and additional Fair Trade social premium given to producer groups for community development. The money is reinvested into strengthening their community by building health clinics and schools, implementing clean water and sanitation systems, and building roads, bridges and housing to improve the health and well being of their community. Producer organizations are organized into worker owned cooperatives and associations that decide democratically how to spend the Fair Trade premium funds, which are accountable to FLO for their use.
Promotes Environmental Sustainability
Fair Trade certified farmers and artisans are required to ensure that their product was produced using sustainable methods. Farmers use environmentally friendly ways of production by implementing integrated crop management and avoiding the use of toxic chemicals for pest management. Fair Trade assists farmers to grow their products without using chemicals and to use natural resources to grow better crops. Many fair trade products produced by farmers are organic. Organic products are grown without using chemicals or pesticides, which ultimately is healthier for the consumer and more sustainable for the environment. Organic farming methods also improve soil fertility and reduce soil erosion. 85% of Fair Trade coffee is certified organic. A similar percentage is shade grown. Instead of cutting down trees and destroying land and wildlife habitats, coffee is grown under shade trees and provides a sustainable livelihood for farmers without destroying natural resources.
Financial and Technical Support
Members of the Fair Trade Federation (FTF) that buy products directly from producers, such as retailers and importers, often provide financial assistance either through direct loans, prepayment or by linking producers with sources of financing. Unlike many commercial importers who often wait 60-90 days before paying producers, many Fair Trade Organizations ensure prepayments so that producers have sufficient funds to cover raw materials and basic needs during production time. Fair Trade Organizations regularly provide technical and skill training to farmers and artisans to enhance their production methods. They also often provide other critical technical assistance and support such as market information, product feedback and training in financial management.
Direct, Long-Term Relationships
Importers of Fair Trade Certified products and other fairly traded goods agree to establish long-term sustainable relationships with producer groups.
Your role as a consumer
Exercise your power as a consumer. Ask your local retailer, coffee shop or school cafeteria to stock Fair Trade items.
