7.5.2 Fair Trade

 

 

One critical aspect of the current global crisis is the plight of small producers, particularly those operating in agrarian sectors. The extent of the problem is perhaps most dramatically illustrated by the recent waves of suicides among cotton farmers in India, in which thousands of farmers have taken their own lives.1 One initiative that seeks to address the situation of small agricultural producers is the certified Fair Trade (FT) network. Initially purporting to offer an alternative form of trade relations, FT certification offered members of small producer organization higher prices for their produce than available at the world market, as well as providing several other benefits (e.g., advanced payments, a social premium for community development projects, technical assistance, long-term contracts, etc.).

Mukherjee, Reed [see reference 16]

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Max Havelaar (Netherlands) is acknowledged as launching the first Fairtrade consumer guarantee in 1986 on coffee from Mexico. Subsequently, the number of organisations included in the Fairtrade Foundation number some nineteen, running the international standard and setting up and maintaining the Fairtrade Labelling Organisations International (FLO). Labelling initiatives include many items such as tea, coffee etc. Producers registering with FLO receive a minimum price which covers production costs and an extra premium to be invested in the local community. Members of the FLO Board include four producer representatives two commercial partners and national Fairtrade initiative representatives. By September 2004 there were 422 Fairtrade certified producers operating in 49 countries. Hundreds of Fairtrade registered importers and retailers operate in 19 countries. Sales across the 18 countries that license the Fairtrade market are growing at about 20% year on year. In most of these countries, Fairtrade products are now mainstream items and available in major supermarkets and independent retailers and are beginning to gain market shares.

OpenLearn [see reference 17]

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