WFTO and other cooperative initiatives claim that their aims are to ensure and promote better trading conditions[1], social justice[2] and protect the rights of wrokers and producers.[3] They seek to offer workers and farmers access to a better livelihood and better working conditions[4]. In order to implement these objectives fairtrade is using several rules such as a strict certification procedure that includes standards such as environmental support, better working conditions based on corporate social responsibility[5], a price premium to benefit producers and a fixed price of produce[6].However a great debate and controversy surrounds fair-trade.
Some claim that under the FLO rules a farm needs to exploit in its agenda to part time working instead of hiring full time workers in order to qualify as fair trade. This means that part time workers do not have the same rights with full time workers.[7]Although, there have been various reports of horrible working conditions with some of the farmers alleging not having knowledge of the entitlement of a premium.[8] Fair trade is also criticised that instead of helping problematic farming communities in changing their ways they guarantee a fixed price usually higher than the market average holding them back from developing.[9] Although, evidence supports that the premium policy is not effective.
Moreover, many critics support that fair trade is trying to create a ‘guilty conscience’[10] to consumers in order to create a ‘moral monopoly’[11]. Others support the view that the adverse effect of price fixing and of buying produce without taking into consideration demand resulting to a price crunch.[12]
Concluding, fair-trade introduces a competent perception but in its practical application appears to have many insufficiencies due to a number of elements but the Fairtrade Foundation states that always takes very seriously any complaints affecting workers and farmers. [13]
[1] Fair Trade Labelling Organisations International, ‘What is fairtrade?’ <http://www.fairtrade.net/what_is_fairtrade.html>
[2] The fair Trade Coffee Company, ‘Definition of Fair Trade’ <http://www.fairtradecoffee.org/articles/ft-definition.shtml >
[3] World Fair Trade Organisation, ‘What is fair-trade?’ <http://www.wfto.com/index.php?option=com_content&task=view&id=1&Itemid=13>
[4] Fairtrade Foundation, ‘The Fairtrade foundation’ <http://www.fairtrade.org.uk/what_is_fairtrade/fairtrade_foundation.aspx>SustainWeb, ‘Trade Fair’ <http://www.sustainweb.org/sustainablefood/trade_fair/>
[5] Fair Trade Labelling Organisations International, ‘Benefits of fairtrade’http://www.fairtrade.net/benefits_of_fairtrade.html
[6] Fair Trade Labelling Organisations International, ‘What is fairtrade?’http://www.fairtrade.net/what_is_fairtrade.html
[7] D Henderson, ‘Fair Trade is Counterproductive and Unfair’ (2008) Economic Affairs 62-64 ,cited in A M Smith, Evaluating the criticisms of fair trade, Oxford: Blackwell Publishing, 2009, p.30
[8] P Bahra, ‘Tea workers still waiting to reap Fairtrade benefits; Premium paid for ethical goods may not be passed on, reports Parminder Bahra’ [2009] London Times http://www.lexisnexis.com/uk/nexis/docview/getDocForCuiReq?lni=4V8W-X8W0-TX5B-909P&csi=10939&oc=00240&perma=true
[9] M Sidwell, Unfair Trade (Adam Smith Institute, London 2008) <http://www.adamsmith.org/blog/international/unfair-trade/> B O’Neill, ‘How fair is Fairtrade?’ <http://news.bbc.co.uk/1/hi/magazine/6426417.stm>
[10] K Deconinck, ‘Free marketeers attack Fairtrade principle’ (London 16 March 2004) < http://news.bbc.co.uk/1/hi/business/3542517.stm>
[11] M Sidwell, Unfair Trade (Adam Smith Institute, London 2008) <http://www.adamsmith.org/blog/international/unfair-trade/>
[12] D Henderson, ‘Fair Trade is Counterproductive and Unfair’ (2008) Economic Affairs 6,cited in A M Smith, Evaluating the criticisms of fair trade, Oxford: Blackwell Publishing, 2009, p.30
[13]Fairtrade Foundation, ‘In response to Channel 4 news item on Fairtrade and tea estates in India’
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