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Fairtrade

Fairtrade

Category: Ethical

Updated: 31/10/2008
First Published: 10/07/2007

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

According to the Fairtrade Foundation, Fairtrade is essentially about ensuring that producers in poor countries get a fair deal, for example:

  • A fair price for goods
  • Long-term contracts
  • Support to gain knowledge and skills

Most of you have probably seen the Fairtrade mark, which is an independent consumer label that appears on products to guarantee that producers in the developing world are getting a fair deal. For a product to display the Fairtrade mark it must meet the international Fairtrade standards.

Fairtrade labelling is helping consumers play an important role to improve conditions for people in developing countries. Through buying Fairtrade products, you are buying direct from farmers at better prices. It's estimated that 1 million farmers are involved in Fairtrade, with millions more people directly benefiting from the investment in local communities that Fairtrade brings.

Fairtrade has really taken off over the last decade as consumer awareness of Fairtrade and the treatment of producers in poor countries have increased. More retailers are stocking Fairtrade goods than ever before, on everything from chocolate to tea and coffee, so there has never been a better time to buy Fairtrade.

Making trade fair

According to Oxfam, Fairtrade alone can't address the crisis faced by millions of small-scale farmers and producers who are threatened by low commodity prices and unfair competition from developed countries.

That's why Oxfam have launched a 'Make trade fair' campaign that seeks to address the following issues:

  • Dumping – the rich world insist developing countries get rid of subsidies whilst continuing dump their own subsidised produce on developing countries, which drives down prices and devastates local economies.
  • Market access – developed countries limit and control developing countries' share of the world market by charging high taxes on imported goods, which means developing countries can only afford to export raw materials, which generate far lower revenues than finished goods.
  • Forced liberalisation – developed countries use the World Bank, International Monetary Fund and bilateral trade deals to force developing countries to open the floodgates to cheap imported products, meaning millions of poor farmers can't earn a living and have to rely on food aid instead.
  • Labour rights – developed countries' insatiable demand for faster, more flexible and cheaper production undermine any labour standards they claim to promote. Many workers in developing countries face insecure contracts, intense production pressure and intimidation.
  • Patents – developed countries insist on stringent patent protection, which pushes up the price of essential products like seeds, medicines, textbooks and software. Vital drugs are priced out reach of poor people, meaning 14m people die each year from treatable diseases.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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