Fairtrade is a commercial brand. December 4, 2014. hey Benjamin, I do not know if you will see this in time as I am writing it right now but I figure it does not hurt to try. Critics argue that all fair trade does in these circumstances is prop up underperforming farming or manufacturing practices. One year later, in 1990, the European Fair Trade Association (EFTA) was formally established by 11 fair trade import organizations in nine European countries. They argue that the fair trade label, whose initial aim was to empower local producers by identifying fair trade … Instead of supporting others in the movement to carry out this work, TransFair and its parent organization… Environment: industrial, monoculture farming involves the removal of hedges and trees, it poisons nature with pesticides and erodes soil with synthetic fertilisers rather than organic matter. The first fair trade organization in Europe was in the United Kingdom, an offshoot of Oxfam UK, which during the 1950s had sold crafts made by Chinese refugees. When you recognise that as the main aim, you can see that it was very successful. Critics, however, have argued that the expansion of the fair trade movement has come with significant costs. Learn how your comment data is processed. Between the use of these chemicals and modern tilling techniques, the soil is utterly depleted and a layer of hardpan is created below it, eliminating drainage. Trade-led inclusive economic growth enhances a country’s income-generating capacity, which is one of the essential prerequisites for achieving sustainable development. Coffee is a primary example. They argue that the fair trade label, whose initial aim was to empower local producers by identifying fair trade businesses and products, has been diluted over time and is now being used merely as a guarantee against exploitation. Major, mechanized farming methods are what made these people reliant on the so-called First World to begin with. At the same time, Dutch third world groups began to sell cane sugar with the message “by buying cane sugar you give people in poor countries a place in the sun of prosperity”. Of course they’re not perfect but that’s no reason to stop using them. This one, for example: Major, mechanized farming methods are what made these people reliant on the so-called First World to begin with. Corporate dominance: it promotes the corporate sector, that produces fertilisers, pesticides, GM crops and machinery; again, this is the exact opposite of what we should be doing, for social, political and environmental reasons. The WTO’s Aid for Trade initiative can make a big difference in supplementing domestic efforts in building trade capacity, and SDG 8 contains a specific target for countries to increase support under this initiative. Please select which sections you would like to print: While every effort has been made to follow citation style rules, there may be some discrepancies. It depletes the soil, meaning that you also end up using chemical fertilizers. () They also add a premium of around $0.20 for investment in improving productionBuying products with a Fair Trade label gives everyday shoppers influence over the ethics of big corporations. However, it has been mired in controversy and seen to be hijacked by rich country interests, thus worsening the lot of the poor, and inviting protest and intense criticism. But it’s all about who is offering the criticism, and it requires a little detective work to try to discover their motivations. Changes are needed at the World Trade Organization, but weakening it has consequences for U.S. firms. thanks Dave, I guess that makes sense. In 1962 her project was adopted by the MCC as the Overseas Needlework and Crafts Project. Receive email notifications of new posts. It has, however, come in for some criticism for various reasons. This clearing of the native environment eliminated the natural system of pest control, necessitating the use of chemical insecticides. The organization created a fair trade label for their products. In 2006, Fair trade certified sales amounted to approximately $2.3 billion worldwide, a 41% year-to-year increase. In 1964 the organization introduced handicrafts and Christmas cards made in other developing countries. So many artisans, farmers, and producers in the developing world WANT work and employment. Buying green: is ethical consumerism a perfect distraction? Over time a range of products including tea, cocoa, sugar, wine, nuts, and spices were introduced, paralleling a significant increase in the number of World Shops, or Fair Trade shops, around the world. Organisations that are clearly not corporate-funded by the way, are happy to disclose the sources of their funds – see here, for example. - Fair Trade is still capitalist: it doesn’t work towards building an alternative to production for profit on the market. The views expressed in our blog are those of the author and not necessarily lowimpact.org's. Examples of this kind of criticism can be seen here, from the Institute of Economic Affairs, here, from the Adam Smith Institute and WorldWrite and here (written by a program officer at the pro-corporate, ‘libertarian’ Institute for Humane Studies, funded by one of the infamous Koch brothers). Martin Espinoza, Kelseyville, California. The core of the criticism is the view that fair trade uses the classic basic principles of trade with certain social adjustments providing a short-tem effect, but not modifying the global order as such. And fair-trade products generally account for 0.5-5% of all sales in their product categories in Europe and North America. Every crop contains some beans that are of higher quality than others. WFTO has members in 76 countries. This clearing of the native environment eliminated the natural system of pest control, necessitating the use of chemical insecticides. A subsidiary goal of the movement in developed countries is to increase consumer awareness of unjust and unfair international trade practices. Corrections? These criticisms come from pro-corporate, libertarian ‘think-tanks’, and they claim that instead of paying small farmers a little bit more, it’s best to help them ‘modernise’ (which means chemical fertilisers, pesticides and machinery). WorldWrite is part of the LM group of organisations that attract attention by being deliberately provocative, but are essentially anti-environment and pro-corporate. Fair Trade is about transformation and this structural change only comes about by demanding and growing alternative models to the current system. Between the use of these chemicals and modern tilling techniques, the soil is utterly depleted and a layer of hardpan is created below it, eliminating drainage. Many of these points are valid, and will require regulation, changes to some practices and purges of corrupt individuals. It has, however, come in for some criticism for various reasons. A common claim is that not enough money makes it to producers, but even if increases in farmers’ income are relatively small in real terms, this can still represent a significant percentage increase that can help them hold on to their land, and more importantly, it guarantees prices over a longer period, allowing them to make realistic plans that otherwise wouldn’t be possible. In 1949 a nonprofit organization called SERRV (Sales Exchange for Refugee Rehabilitation and Vocations) was established in the United States by the Church of the Brethren to form trade relationships with poor communities in South America. 1. Smith, Alastair M. (2009), Fair Trade, Diversification and Structural Change: Towards a broader theoretical framework of analysis Oxford Development … Fair Trade USA ensures that in return for their commitment to social and environmental sustainability through the Fair Trade standards, farmers receive a price that is always higher than the market price. 10. Lowimpact.org is a workers' co-operative. This is the most pernicious argument of all – a disguised attempt to remove smallholders from their land. Such criticism must provide encouragement to the Fair Trade movement, because they know that they have hit the corporate sector where it hurts most, by helping to distribute wealth away from them and towards small farmers. The WTO is criticised for being undemocratic. Fair trade allows for a working, business relationship that is much MUCH more sustainable than charity. The movement created a global industry and continues to expand, with organizations at all levels involved. It was renamed Ten Thousand Villages in 1996. Company No: 4205021. Hi Dr Rollinson, thank you for a very interesting and informative basic introduction to Gasification. Anyone who claims that these people need to convert to our way of farming is really saying that they need to convert to our way of life (such as it is) because there is something wrong with theirs. Wereldhandel, later renamed Fair Trade Original. This site uses Akismet to reduce spam. The more that small farmers are helped to prevent wealth extraction by the corporate sector the better, wherever they are. Adam Smith unequal free trade is little more than a philosophy for the continued subtle monopolization of the wealth-producing-process , largely through continued privatization of the commons of both an internal economy and the economies of weak nations on the periphery of trading empires. Environmental devastation. Only mixed, intensively-farmed smallholdings will feed a global population headed towards 11 billion, without eroding soil and biodiversity. Fair trade proves that greater justice in world trade is possible. It’s exploitation and poverty that pushes small farmers off their land, not a desire to escape the lifestyle. I urge you to reject these types of arguments as disingenuous, pro-corporate and environmentally-damaging, and to investigate the kinds of groups making them. Europe joined the movement during the late 1950s, when the Quaker-led Oxford Committee for Famine Relief—now Oxfam International—began selling arts and crafts made by Chinese refugees in its shops in the United Kingdom. Omissions? Some have charged that the fair trade label has been used as a marketing tool to entice consumers in developed countries to pay higher prices for certain products whose sale does little to benefit producers in poor countries. One 2015 study in a journal published by the MIT Press concluded that producer benefits were close to zero because there was an oversupply of certification, and only a fraction of produce classified as Fair Trade was actually sold on Fair Trade markets, just enough to recoup the costs FINE was dedicated to increasing worldwide awareness of the fair trade movement through active campaigning in political circles and organizing public events. 2 buying Fairtrade goods they are giving producers a fair price, dealing fairly with them, and giving money to poor producers in the Third World. Fairtrade addresses the injustices of conventional trade, which too often leaves the poorest, weakest producers earning less than it costs them to grow their crops. Registered in England. Beware. https://www.britannica.com/topic/fair-trade, World Fair Trade Organization - History of Fair Trade, Harvard University - Publications - The Economics of Fair Trade, United Nations Conference on Trade and Development. It was called Max Havelaar, after a fictional Dutch character who opposed the exploi-tation of coffee pickers in Dutch colonies. “This confirms the criticism of Fairtrade that, in spite of good intentions and concrete improvements for farmers, the reality for small-scale farmers is a shift from poverty to certified poverty,” argued Roozen in a press release. In 1973 coffee was added to the fair trade product line, with the first imports coming from cooperatives in Guatemala. Coffee is a primary example. These groups went on to sell handicrafts from the South, and in 1969 the first “Third World Shop” opened. Fair trade attracts bad beans. I can see how tax would now work (the Mutual credit system could also sell a product tax... Why much criticism of the Fair Trade movement is invalid – designed to disguise corporate exploitation of small farmers, How we got olive oil from a small farm in Portugal brought over in a sailboat by a co-operative based in Brighton – and how you can do the same. Former assistant editor, economics, Encyclopædia Britannica. There is an app for smart phones at https://mobi.community-exchange.org/ and in Australia its https://mobi.communityexchange.net.au/. In the 1960s, the fair trade movement began to take shape, along with the criticism that industrialized countries and multinational corporations were using their power for further enrichment to the detriment of poorer counties and producers, particularly of agricultural products like coffee. The important things to remember are: 1) that there is no food shortage, only a shortage of money for many people in poor countries, that prevents them from buying enough food – if they had more money, they could eat as much as people in the West; and 2) that smallholdings produce more food per acre than large, monoculture farms (see ‘food production’, below). Smaller farmers couldn’t afford the machinery, pesticides etc, and couldn’t compete with larger farmers, who eventually bought them out and employed them as labourers, until more machinery and pesticides made their jobs superfluous, and they moved to urban slums. Earth.Food.Love: the story of the UK's first zero-waste shop, What happened to LETS systems? Despite a lack of comprehensive data, over the last 5 years, it is clear fair trade has come to occupy an important niche in some limited con-sumer markets and areas. Some criticisms have been raised about fair trade systems. Food production: it leads to an increase in the size of farms, when the opposite should be happening. WFTO verification should not be confused with commodity certification syst… The World Trade Organization, (WTO), is the primary international body to help promote free trade, by drawing up the rules of international trade. All coffee used to be shade-grown. But free trade as practiced by Adam Smith neo-mercantilists was far from fair trade. Its owners, the Fairtrade Foundation, have been very successful in persuading customers that it does ethical trading, and that by . A (1993 & 1996) study of customers for 2 large ATOs (Alternative Trading It depletes the soil, meaning that you also end up using chemical fertilizers. 2. Since the mid-20th century the fair trade movement has changed the lives of thousands of workers in developing countries by providing them with access to European and North American markets. No system is perfect but Fair Trade generally does what it says on the tin. Starbucks in adopting Fair Trade has obviously spawned criticism from various Fair Trade observers. The first formal fair trade shop in the United States, where goods from SERRV and other organizations were sold, was established in 1958. Yes, they stand for liberty from state interference, but they deliberately ignore the corporate-state alliance, and the fact that liberty is just as impossible under a corrupt corporate hierarchy as it is under an oppressive state hierarchy. Today most of it is produced in cleared fields. In this extract from The Fair Trade Scandal, Ndongo Samba Sylla argues that the narrow approach of Fairtrade puts its financial rewards out of reach for many developing countries The 1980s witnessed the creation of the first fair trade labeling organizations, which eventually enabled fair trade products to reach broader audiences. The Foundation was established in 1992 by CAFOD, Christian Aid, New Consumer, Oxfam, Traidcraft and the World Development Movement. Get a Britannica Premium subscription and gain access to exclusive content. For ideological reasons, ‘free-market’ economists (the modern capitalist economy is anything but free) or corporate think-tanks will try to tell you that Fair Trade doesn’t help the poorest farmers – because maybe Fair Trade groups are operating in Central America but not Ethiopia. It’s a modern-day enclosure movement that robs small farmers of their land and enriches Western corporations producing machinery and synthetic fertilisers and pesticides. By signing up for this email, you are agreeing to news, offers, and information from Encyclopaedia Britannica. Fair Trade guarantees that the buyer of a particular product such as coffee or bananas must pay the farmer enough to cover the cost of growing their crop or the market value for their goods, whichever is higher. Our support for Fair Trade doesn’t have to be unconditional – we can still be critical of specific practices or examples of corruption – but overall, Fair Trade represents a noble attempt to help smallholders to make enough money, and to organise to be able to keep their land, and so to counter the trend towards large, monoculture farms that has so damaged rural livelihoods and the environment in the West. The Fair Trade movement was set up to secure better prices for struggling small farmers and craft producers in poor countries, and to provide funds for various improvements in their communities. There are many more examples. Judging by the comments on the BBC article, most readers weren’t fooled. The Max Havelaar label, created in the Netherlands in 1988, was named after a fictitious character who battled government corruption and the exploitation of local coffee farmers by Dutch colonialists in 19th-century Java. Although the agenda adopted in the UNCTAD was never fully implemented at the national level, its message contributed to the spread of fair trade practices around the world, thanks in large part to citizen-led initiatives. These organisations are anti-environment, pro-corporate and ‘libertarian’ in ways that don’t actually promote liberty. In 1967 Fair Trade Original began purchasing products from producer groups in developing countries, initially importing wood carvings from the slums of Port-au-Prince, Haiti, and later establishing subsidiaries in West Germany, Austria, Switzerland, and Belgium. Another tactic that they use is to claim that people don’t really want to be peasant farmers, because it’s too much like hard work. My guess is that they’re largely funded by the corporate sector – the ultimate beneficiary of their propaganda – but it’s difficult to know, because they don’t generally disclose their funders. In fact, the journalist in the BBC article in the link above, who introduces WorldWrite, is also from the LM stable. There is no consensus regarding a starting date of the fair trade movement. Parallel developments took place in the Netherlands, led by the charitable Roman Catholic organization S.O.S. Please refer to the appropriate style manual or other sources if you have any questions. Critics, however, have argued that the expansion of the fair trade movement has come with significant costs. See here and here for two examples. The World Trade Organization is facing the biggest crisis in its 25-year history. The Fair Labor Association, the firm that Apple has hired to examine worker conditions at the plants of its suppliers, has been criticized by labor groups as ineffective.