what is fair trade?

Currently the most widely recognized definition of Fair Trade was created by FINE:

Fair Trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers - especially in the South. Fair Trade organisations (backed by consumers) are engaged actively in supporting producers, awareness raising and in campaigning for changes in the rules and practice of conventional international trade. Fair Trade's strategic intent is:

• deliberately to work with marginalised producers and workers in order to help them move from a position of vulnerability to security and economic self-sufficiency
• To empower producers and workers as stakeholders in their own organisations
• To actively to play a wider role in the global arena to achieve greater equity in international trade.

Fair Trade History – New Zealand

In 1969, a Christchurch couple Vi and Richard Cottrell began importing carpets from Northern India to create an income for Tibetan refugees and Trade Aid (http://tradeaid.org.nz) was born.  Over the subsequent decades, Trade Aid has successfully grown to a network of 30 shops around New Zealand selling a range of fairly-traded products from all over the world.  The majority of Trade Aid consumables are now organic, adding further value to the products.  Links on the Trade Aid website list cafes, restaurants, supermarkets and organic stores who are all supporting fair trade.

In 2003, the Fair Trade Association of Australia and New Zealand (FTAANZ) was established, and products bearing the Fairtrade Certification label began being sold in October 2003.  FTAANZ also works with Oxfam New Zealand  and Trade Aid to promote fair trade in New Zealand, culminating each year with the celebration of fair trade during Fair Trade Fortnight in May.

Fair Trade Growth in New Zealand and Australia

By 2007 annual retail sales of Fair Trade products had reached in excess of AU$12 million a year, and in New Zealand alone quarterly retail sales are set to top NZ$1 million for the first time. All this amounts to more than AU$25 million in total retail sales in Australia and New Zealand since the first Fair Trade Certified and Labelled product was launched in September 2003. This remarkable growth is reflected in a global Fair Trade trend with worldwide annual sales increasing by 40% to 1.6 billion Euros (AU$2.5 billion), benefiting over 1.4 million producers and workers.

Terminology and Certifications

The term Fair Trade is used by organisations that have fair trade as the core concept of the all the work they do and if they sell products they sell exclusively fair trade products (usually handicrafts). The World Fair Trade Organisation (WFTO), is the global network of Fair Trade Organisations (FTOs), and in 2008 comprising 270 organizations in 60 countries. Its membership is growing steadily.  The World Fair Trade Organisation mark (below) has not been designed as a label to appear on handicrafts or other products. It is a mark to identify FTOs.  FTOs that are accredited by WFTO in NZ are Trade Aid and the Fair Trade Association (FAANZ); in Australia there is also Oxfam.

 

The FAIRTRADE Label

The Fairtrade Certification Label (http://www.fairtrade.net/) is an independent consumer certification label which appears on products (usually commodities) as an independent guarantee that disadvantaged producers in the developing world are getting a better deal for that product. As a result of Fair Trade, these producers receive a Fair Trade Minimum Price that covers the cost of sustainable production as well as an extra Fair Trade Premium that is invested in social or economic development projects in their respective communities.  For a product to display the Fairtrade Certification Label it must meet international Fair Trade Standards. Non-FTOs can and do have Fairtrade certified products. It has been estimated that around 65% of all Fair Trade consumables are being sold with the Fairtrade Label.  In the case of coffee, the packaging may say Fair Trade without the above label; some just sell it as conventional coffee. Then there may also be others using certifications such as UTZ or Rainforest Alliance and calling it Fair Trade, which it isn't by WFTO standards, but each system has merits ethically and environmentally.

 

YOUR LIFESAVING CUPPA: What is Fair Trade? 

Organic Explorer, the Green Travel Guide to New Zealand, puts Fair Trade into the context of Global Sustainability:

"The world’s poorest peoples, the peoples of Bangladesh, of sub-Sahara Africa, Ethiopia and other undeveloped countries are extremely vulnerable, and Fair Trade commerce provides a real and significant lifeline to their economies. These people are currently beginning to feel the first impact of global warming both economically and environmentally, yet leave perhaps the lowest carbon footprint on the planet. Their food is almost always organic and their crafts are usually made in low energy conditions – without electricity, the use of fossil fuels or heavy machinery.  By supporting Fair Trade practices we help to sustain these impoverished communities. We assist them in achieving economic, social, cultural and political independence and sustainability perhaps more than donating to world aid charities, since Fair Trade is grounded on principles of grass-root independence."  Taken from the Editor's notes.