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Fair Trade is a commercial relationship that promotes more equity in international trade via communication, transparency, and respect.
What does the term "fair trade" imply? Is it better to pay workers more or to ensure that farmers and manufacturing workers are treated fairly? Is it similar to direct trading, or it’s more? Is this only true for chocolate, coffee, or organic bags? As the certification grows in popularity, more customers are aware of the notion, but many appear to only have a cursory comprehension of it.
They want to make sure that consumers share their values, thus as a Fair-Trade private label brand focused on manufacturing the finest Fair Trade cotton bags, garments, and accessories, wants to make sure that the products are worthy and the best that the consumer can have.
Today, Fair Trade is a really global phenomenon. In over 70 countries in the South, over a million small-scale farmers and employees are organized in 3,000 grassroots organizations and their umbrella institutions. Their products are sold in tens of thousands of World-shops or Fair-Trade stores, supermarkets, and other retail outlets in the Northern Hemisphere, as well as an increasing number of retail outlets in the Southern Hemisphere.
The movement is debating how to make international commerce more equitable with political decision-makers in European institutions and international fora. Furthermore, Fair Trade has raised awareness of mainstream business's social and environmental responsibilities. In a nutshell, Fair Trade is growing in popularity.
Where did it all begin?
The history of Fair Trade is littered with legends. Ten Thousand Villages (previously Self-Help Crafts) began purchasing needlework from Puerto Rico in 1946, and SERRV began trading with impoverished villages in the South in the late 1940s. In the United States, the first formal “Fair Trade” shop selling these and other things established in 1958.
Fair Trade in Europe dates back to the late 1950s, when Oxfam UK began selling products manufactured by Chinese refugees in their stores. It founded the first Fair Trade Organization in 1964.
At the same time, Dutch organizations began selling cane sugar with this message: "By purchasing cane sugar, you are providing a place in the sun of prosperity for people in needy nations”.
These organizations moved on to market southern handicrafts, and the first "Third World Shop" opened in 1969. World Shops, also known as Fair Trade shops in other parts of the world, have played (and continue to play) an important role in the Fair-Trade movement. They are not only pointing of commerce, but they are also quite active in lobbying and promoting awareness.
Many new Fair-Trade Organizations in the South were formed, and connections were forged with the emerging organizations in the North. Partnership, conversation, honesty, and respect were the foundations of these relationships. The purpose was to improve international trade equity.
Parallel to the citizens' movement, poor countries addressed international political fora, such as the second UNCTAD (United Nations Conference on Trade and Development) in Delhi in 1968, to convey the slogan "Trade, not Aid." Instead of seeing the North take all the benefits and only return a little portion of them in the form of development aid, this strategy emphasized the construction of equal commercial relations with the South.
From the late 1960s onwards, the emergence of Fair Trade (or alternative trade, as it was sometimes known) has been predominantly linked to development trade. It arose as a response to poverty and tragedy in the South, focusing on the marketing of handcrafted goods. It was frequently founded by significant development and religious agencies in European countries.
These NGOs helped to develop Southern Fair-Trade Organizations, which coordinate producers and production, provide social assistance to producers, and export to the North, in collaboration with their counterparts in the South. A branch of solidarity trade existed alongside the development trade. Organizations were formed to import commodities from politically and economically marginalized progressive countries in the South.
Fair Trade, As Defined by The World Fair Trade Organization (WFTO)
The term "fair trade" refers to a trading cooperation, based on transparency, on dialogue, and respect, which seeks greater equity in international trade. It contributes to long-term development by improving trading circumstances for underprivileged workers and producers and ensuring their rights.
Fair Trade groups have made it clear that Fair Trade is at the heart of their work. They are actively helping producers, raising awareness, and pushing for reforms in the norms and practices of traditional international trade, with the backing of consumers.
In a nutshell, Fair Trade is a worldwide movement of consumers, producers, corporations, and certifiers who prioritize people and the environment. They all collaborate to ensure that resources are treated as finite and that products are created that benefit the people who manufacture them and the land on which they are grown.
Fair Trade arose in response to the harmful consequences of unfair trade practices and the growing gap between the global North and the global South.
The Fair-Trade movement has grown at an exponential rate since its inception, as more consumers understand that while many people benefit from markets, subsidized commodity items, and mass-produced products, many artisans, farmers, and children lose their livelihoods, freedoms, and, in the worst cases, human rights.
According to a new report from Fairtrade America, global sales of fair-trade products increased by 8% in 2017, hitting approximately $9.2 billion and producing a new high of $193 million in Fairtrade Premium funding for farmers and workers' organizations.
What are the requirements?
To be Fair Trade certified, a product must be made by a farmer, cooperative, or group of employees who meet the Fair-Trade labeling body's guidelines. There are currently around 11 certifiers operating globally, each with their own set of requirements. These guidelines differ slightly, however they all demand that:
- A Fair-Trade minimum wage is paid to workers.
- The environment's sustainability is maintained.
- Working conditions are kept safe.
- There is no child or forced labor.
- Producers are compensated based on the quality of their work.
- These premiums are deposited in a communal fund that will be utilized to fund development projects.
- Consumers may see the entire supply chain.
Why Fair Trade?
The global fashion business now employs over 60 million people, the majority of whom labor in hazardous manufacturing and environmental conditions for pitiful wages. Globally, the industry's annual revenues are calculated in trillions of dollars.
Many well-known shops say that they have no idea how the cotton they buy is grown or processed. Worse, the fashion business is one of the most extractive and polluting industries in the world. Farmers in regions of China and India may forecast the color of the following fashion season by looking at the hue of their rivers, which are affected by textile industry run-off.
A lot of people knew that they had to join the Organic and Fair-Trade movement and incorporate it into their business. They knew that this was the best thing to do when they traveled through those countries and observed those employees firsthand.
It is the only way for them to do business in a way that can compete with fast fashion and global behemoths who have no idea who their enterprises are affecting or what the genuine cost of the low-priced goods they flood the market with.
Their packaging goods, such as muslin drawstring bags, are biodegradable, reusable, sustainable, and chemical-free. They know that they are not disregarding anyone while creating something significant, responsible, and authentic since the approach they utilize does not hurt the ecosystem or its inhabitants.
The benefits of Fair Trade
Fairtrade means farmers get paid fairly.
There is a Fairtrade minimum price for most Fairtrade commodities, which serves as a vital safety net for farmers who are vulnerable to market fluctuations. Farmers will be able to make a consistent income and plan for their future as a result of this.
Fairtrade is the only certification method that provides farmers with such a unique minimum price guarantee.
In addition, a Fairtrade Premium is put into a communal fund for workers and farmers to utilize as they see fit, such as for their children's education or healthcare, upgrading their business, or constructing community infrastructure such as roads and bridges.
- Environmentally, Fairtrade is preferable.
- Organizations that want to be Fairtrade certified must follow strict environmental guidelines.
- Farmers are encouraged to switch to organic farming and:
- Protect their local environment by using agrochemicals sparingly and safely.
- Correctly manage erosion issues and garbage management.
- Keep the soil fertile.
- Avoid employing genetically engineered creatures on purpose (GMOs).
- Monitor their influence on the environment on a regular basis and implement strategies to reduce it.
Farmers and communities gain from Fairtrade coffee
Costa Rican coffee producers have invested in ovens that are powered by the waste coffee husks from the beans they are roasting.
As a result, the number of trees felled for firewood has decreased.
Using the premium generated from its coffee, the Nicaraguan UCA cooperative erected a pre-school.
Child labor is prohibited under Fairtrade
Fairtrade indicates there is no tolerance for child labor, and the organization seeks to eliminate it.
Children under the age of 18 are prohibited from working in jobs that jeopardize them or their education. Fairtrade organizations are also prohibited from employing children under the age of 15.
More advantages of Fairtrade
- Fairtrade helps producers invest by providing access to and overseeing loans. The UCA cooperative, for example, took out a loan to build a drying mill for its coffee. The mill is currently repaying the financing that allowed it to be built while also lowering processing costs.
- Food security is connected to economic growth, secure incomes, and reduced risk and vulnerability, all of which can be improved by Fairtrade. If a farmer's income is higher, he or she will have more money to buy food and invest in growing more crops.
- Fairtrade shopping allows customers to live and shop according to their values while also helping farmers and their families.
- Fairtrade allows consumers to connect with the people who cultivate the food we eat and need.
Is it true that Fair Trade Certified organic items are likewise certified organic?
Not required; nevertheless, over half of all Fair-Trade Certified items imported into the United States are also organic, and Fair-Trade USA encourages organic farming by providing farmers with training and tools, as well as a higher price for organic commodities.
What if I told you that:
- It's worth looking around because there are 4,500 Fairtrade certified items on sale in the UK.
- In 2016, the UK spent £1.64 billion on Fairtrade products, owing to the growing popularity of Fairtrade bananas and coffee.
- Bananas account for around 9% and 8% of Ecuador's and Costa Rica's overall export revenues, respectively.
- In 2015, more than half of all Fairtrade bananas sold (55%) and 59 percent of all Fairtrade coffee beans sold were organic.
Fair Trade has grown into a popular movement throughout the course of its 60-year history. Fair Trade has gained respect among politicians and mainstream corporations thanks to the work of Fair-Trade Organizations around the world. As Fair-Trade Organizations become more powerful actors and mainstream firms become more aware of the desire for Fair Trade in the marketplace, more triumphs are likely. As we continue to write Fair Trade history, keep an eye on this space!
With the assistance and guidance of a number of Fair-Trade pioneers, this version of the History of Fair Trade was created and edited on behalf of WFTO.
Fair Trade has shown that it may be a huge help to farmers in developing countries.
It not only addresses the core issue of fair salaries for these producers, but it also demonstrates concern for the workers' and their families' health and education.
Overall, Fair Trade has the potential to be a solution to many of the current production-related challenges.
Today, Fair Trade is your assurance that a product was traded in a more ethical manner, resulting in better working conditions, improved livelihoods, and environmental protection.