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For other uses, see Fair trade (disambiguation).
Fair trade is a social movement whose stated goal is to help producers in developing countries achieve better trading conditions and to promote sustainable farming. Members of the movement advocate the payment of higher prices to exporters, as well as improved social and environmental standards. The movement focuses in particular on commodities, or products which are typically exported from developing countries to developed countries, but also consumed in domestic markets (e.g. Brazil, India and Bangladesh) most notably handicrafts, coffee, cocoa, wine, sugar, fresh fruit, chocolate, flowers and gold. The movement seeks to promote greater equity in international trading partnerships through dialogue, transparency, and respect. It promotes sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers in developing countries. Fair trade is grounded in three core beliefs; first, producers have the power to express unity with consumers. Secondly, the world trade practices that currently exist promote the unequal distribution of wealth between nations. Lastly, buying products from producers in developing countries at a fair price is a more efficient way of promoting sustainable development than traditional charity and aid.
Fair trade labeling organizations that is commonly use a definition of fair trade developed by FINE, an informal association of four international fair trade networks: Fairtrade Labelling Organizations International, World Fair Trade Organization (WFTO), Network of European Worldshops and European Fair Trade Association (EFTA). Specifically, fair trade is a trading partnership, based on dialogue, transparency, and respect, that seeks greater equity in international trade. Fair trade organizations, 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.
There are several recognized fair trade certifiers, including Fairtrade International (formerly called FLO, Fairtrade Labelling Organizations International), IMO, Make Trade Fair and Eco-Social. Additionally, Fair Trade USA, formerly a licensing agency for the Fairtrade International label, broke from the system and is implementing its own fair trade labelling scheme, which has resulted in controversy due to its inclusion of independent smallholders and estates for all crops. In 2008, Fairtrade International certified approximately (€3.4B) of products. The World Trade Organization publishes annual figures on the world trade of goods and services.
The fair trade movement is popular in the UK, where there are 500 Fairtrade towns, 118 universities, over 6,000 churches, and over 4,000 UK schools registered in the Fairtrade Schools Scheme. In 2011, over 1.2 million farmers and workers in more than 60 countries participated in Fairtrade International's fair trade system, which included €65 million in fairtrade premium paid to producers for use developing their communities. According to Fairtrade International, nearly six out of ten consumers have seen the Fairtrade mark and almost nine in ten of them trust it.
Some criticisms have been raised about fair trade systems. One 2015 study in a journal published by the MIT Press concluded that producer benefits were close to zero because there was an oversupply of certification, and only a fraction of produce classified as fair trade was actually sold on fair trade markets, just enough to recoup the costs of certification. Some research indicates that the implementation of certain fair trade standards can cause greater inequalities in some markets where these rigid rules are inappropriate for the specific market. In the fair trade debate there are complaints of failure to enforce the fair trade standards, with producers, cooperatives, importers and packers profiting by evading them. One proposed alternative to fair trade is direct trade, which eliminates the overhead of the fair trade certification, and allows suppliers to receive higher prices much closer to the retail value of the end product. Some suppliers use relationships started in a fair trade system to autonomously springboard into direct sales relationships they negotiate themselves, whereas other direct trade systems are supplier-initiated for social responsibility reasons similar to a fair trade system.
There are a large number of fair trade and ethical marketing organizations employing different marketing strategies. Most fair trade marketers believe it is necessary to sell the products through supermarkets to get a sufficient volume of trade to affect the developing world. The Fairtrade brand is by far the biggest of the fair trade coffee brands. Packers in developed countries pay a fee to The Fairtrade Foundation for the right to use the brand and logo, and nearly all the fee goes to marketing. Packers and retailers can charge as much as they want for the coffee. The coffee has to come from a certified fair trade cooperative, and there is a minimum price when the world market is oversupplied. Additionally, the cooperatives are paid an additional 10c per lb premium by buyers for community development projects.[pages needed] The cooperatives can, on average, sell only a third of their output as fair trade, because of lack of demand, and sell the rest at world prices.[pages needed] The exporting cooperative can spend the money in several ways. Some go to meeting the costs of conformity and certification: as they have to meet fair trade standards on all their produce, they have to recover the costs from a small part of their turnover, sometimes as little as 8%, and may not make any profit. Some meet other costs. Some is spent on social projects such as building schools, health clinics and baseball pitches. Sometimes there is money left over for the farmers. The cooperatives sometimes pay farmers a higher price than farmers do, sometimes less, but there is no evidence on which is more common.
The marketing system for fair trade and non-fair trade coffee is identical in the consuming countries, using mostly the same importing, packing, distributing and retailing firms. Some independent brands operate a "virtual company", paying importers, packers and distributors and advertising agencies to handle their brand, for cost reasons. In the producing country, fair trade is marketed only by fair trade cooperatives, while other coffee is marketed by fair trade cooperatives (as uncertified coffee), by other cooperatives and by ordinary traders.
To become certified fair trade producers, the primary cooperative and its member farmers must operate to certain political standards, imposed from Europe. FLO-CERT, the for-profit side, handles producer certification, inspecting and certifying producer organizations in more than 50 countries in Africa, Asia, and Latin America. In the fair trade debate there are many complaints of failure to enforce these standards, with producers, cooperatives, importers and packers profiting by evading them.
There remain many fair trade organizations that adhere more or less to the original objectives of fair trade, and that market products through alternative channels where possible, and market through specialist fair trade shops, but they have a small proportion of the total market.
Effect on growers
Fair trade is benefiting farmers in developing countries, whether that be considerably or just a little. The nature of fair trade makes it a global phenomenon, therefore, there are diverse motives for understanding group formation related to fair trade. The social transformation caused by the fair trade movement also varies around the world.
A study of coffee growers in Guatemala illustrates the effect of fair trade practices on growers. In this study, thirty-four farmers were interviewed. Of those thirty-four growers, twenty-two had an understanding of fair trade based on internationally recognized definitions, for example, describing fair trade in market and economical terms or knowing what the social premium is and how their cooperative has used it. Three growers explained a deep understanding of fair trade, showing a knowledge of both fair market principles and how fair trade affects them socially. Nine growers had erroneous or no knowledge of Fair Trade. The three growers who had a deeper knowledge of the social implications of fair trade all have responsibilities within their cooperatives. One is a manager, one is in charge of the wet mill, and one is his group's treasurer. These farmers did not have a pattern in terms of years of education, age, or years of membership in the cooperative; their answers to the questions, "Why did you join?" differentiate them from other members and explain why they have such an extensive knowledge of fair trade. These farmers cited switching to organic farming, wanting to raise money for social projects, and more training offered as reasons for joining the cooperative, other than receiving a better price for their coffee.
Many farmers around the world are unaware of fair trade practices that they could be implementing to earn a higher wage. Coffee is one of the most highly traded commodities in the world, yet the farmers who grow it typically earn less than $2 a day. When surveyed, farmers from Cooperativa Agraria Cafetalera Pangoa (CAC Pangoa) in San Martín de Pangoa, Peru, could answer positively that they have heard about fair trade, but were not able to give a detailed description about what fair trade is. They could, however, identify fair trade based on some of its possible benefits to their community. When asked, overall, farmers cited that fair trade has had a positive effect on their lives and communities. They also wanted consumers to know that fair trade is important for supporting their families and their cooperatives.
Some producers also profit from the indirect benefits of fair trade practices. Fair trade cooperatives create a space of solidarity and promote an entrepreneurial spirit among growers. When growers feel like they have control over their own lives within the network of their cooperative, it can be very empowering. Operating a profitable business allows growers to think about their future, rather than worrying about how they are going to survive in poverty.
As far as farmers' satisfaction with the fair trade system, the growers want consumers to know that fair trade has provided important support to their families and their cooperative. Overall, farmers are satisfied with the current fair trade system, but some farmers, such as the Mazaronquiari group from CAC Pangoa, desire yet a higher price for their products in order to live a higher quality of life.
A component of trade is the social premium that buyers of fair trade goods pay to the producers or producer-groups of such goods. An important factor of the fair trade social premium is that the producers or producer-groups decide where and how it is spent. These premiums usually go towards socioeconomic development, wherever the producers or producer-groups see fit. Within producer-groups, the decisions about how the social premium will be spent is handled democratically, with transparency and participation.
Producers and producer-groups spend this social premium to support socioeconomic development in a variety of ways. One common way to spend the social premium of fair trade is to privately invest in public goods that infrastructure and the government are lacking in. These public goods include environment initiatives, public schools, and water projects. At some point, all producer-groups re-invest their social premium back into their farms and businesses. They buy capital, like trucks and machinery, and education for their members, like organic farming education. Thirty-eight percent of producer-groups spend the social premium in its entirety on themselves, but the rest invest in public goods, like paying for teachers' salaries, providing a community health care clinic, and improving infrastructure, such as bringing in electricity and bettering roads.
Farmers' organisations that use their social premium for public goods often finance educational scholarships. For example, Costa Rican coffee co-operative, Coocafé, has supported hundreds of children and youth at school and university through the financing of scholarships from funding from their fair trade social premium. In terms of education, the social premium can be used to build and furnish schools too.
Organizations promoting fair trade
Most of the fair trade import organizations are members of, or certified by one of several national or international federations. These federations coordinate, promote, and facilitate the work of fair trade organizations. The following are some of the largest:
- The FLO International (Fairtrade International), created in 1997, is an association of three producer networks and twenty national labeling initiatives that develop Fairtrade standards, license buyers, label usage and market the Fair trade Certification Mark in consuming countries. The Fairtrade International labeling system is the largest and most widely recognized standard setting and certification body for labeled Fair trade. Formerly named Fairtrade Labelling Organizations International, it changed its name to Fairtrade International in 2009, when its producer certification and standard setting activities were separated into two separate, but connected entities. FLO-CERT, the for-profit side, handles producer certification, inspecting and certifying producer organizations in more than 50 countries in Africa, Asia, and Latin America. Fairtrade International, the non-profit arm, oversees standards development and licensing organization activity. Only products from certain developing countries are eligible for certification, and for some products such as coffee and cocoa, certification is restricted to cooperatives. Cooperatives and large estates with hired labor may be certified for bananas, tea and other crops.
- Fair Trade USA is an independent, nonprofit organization that sets standards, certifies, and labels products that promote sustainable livelihoods for farmers and workers and protect the environment. Founded in 1998, Fair Trade USA currently partners with around 800 brands, as well as 1.3 million farmers and workers across the globe.
- World Fair Trade Organization (formerly the International Fair Trade Association) is a global association created in 1989 of fair trade producer cooperatives and associations, export marketing companies, importers, retailers, national, and regional fair trade networks and fair trade support organizations. In 2004 WFTO launched the FTO Mark which identifies registered fair trade organizations (as opposed to the FLO system, which labels products).
- The Network of European Worldshops (NEWS!), created in 1994, is the umbrella network of 15 national worldshop associations in 13 different countries all over Europe.
- The European Fair Trade Association (EFTA), created in 1990, is a network of European alternative trading organizations which import products from some 400 economically disadvantaged producer groups in Africa, Asia, and Latin America. EFTA's goal is to promote fair trade and to make fair trade importing more efficient and effective. The organization also publishes yearly various publications on the evolution of the fair trade market. EFTA currently has eleven members in nine different countries.
In 1998, the first four federations listed above joined together as FINE, an informal association whose goal is to harmonize fair trade standards and guidelines, increase the quality and efficiency of fair trade monitoring systems, and advocate fair trade politically.
- Additional certifiers include IMO (Fair for Life, Social and Fair Trade labels), Eco-Social and Fair Trade USA.
- The Fair Trade Federation (FTF), created in 1994, is an association of Canadian and American fair trade wholesalers, importers, and retailers. The organization links its members to fair trade producer groups while acting as a clearinghouse for information on fair trade and providing resources and networking opportunities to its members. Members self-certify adherence to defined fair trade principles for 100% of their purchasing/business. Those who sell products certifiable by Fairtrade International must be 100% certified by FI to join FTF.
Student groups have also been increasingly active in the past years promoting fair trade products. Although hundreds of independent student organizations are active worldwide, most groups in North America are either affiliated with United Students for Fair Trade (USA, the Canadian Student Fair Trade Network (Canada), or Fair Trade Campaigns (USA), which also houses Fair Trade Universities and Fair Trade Schools.
The involvement of church organizations has been and continues to be an integral part of the Fair Trade movement:
- Ten Thousand Villages is affiliated with the Mennonite Central Committee
- SERRV is partnered with Catholic Relief Services and Lutheran World Relief
- Village Markets is a Lutheran Fair Trade organization connecting mission sites around the world with churches in the United States
- Catholic Relief Services has their own Fair Trade mission in CRS Fair Trade
Main article: History of fair trade
The first attempts to commercialize fair trade goods in Northern markets were initiated in the 1940s and 1950s by religious groups and various politically oriented non-governmental organizations (NGOs). Ten Thousand Villages, an NGO within the Mennonite Central Committee (MCC) and SERRV International were the first, in 1946 and 1949 respectively, to develop fair trade supply chains in developing countries. The products, almost exclusively handicrafts ranging from jute goods to cross-stitch work, were mostly sold in churches or fairs. The goods themselves had often no other function than to indicate that a donation had been made.
The current fair trade movement was shaped in Europe in the 1960s. Fair trade during that period was often seen as a political gesture against neo-imperialism: radical student movements began targeting multinational corporations and concerns that traditional business models were fundamentally flawed started to emerge. The slogan at the time, "Trade not Aid", gained international recognition in 1968 when it was adopted by the United Nations Conference on Trade and Development (UNCTAD) to put the emphasis on the establishment of fair trade relations with the developing world.
The year 1965 saw the creation of the first Alternative Trading Organization (ATO): that year, British NGO Oxfam launched "Helping-by-Selling", a program which sold imported handicrafts in Oxfam stores in the UK and from mail-order catalogues.
By 1968, the oversized newsprint publication, the Whole Earth Catalog, was connecting thousands of specialized merchants, artisans, and scientists directly with consumers who were interested in supporting independent producers, with the goal of bypassing corporate retail and department stores. The Whole Earth Catalog sought to balance the international free market by allowing direct purchasing of goods produced primarily in USA and Canada, but also in Central and South America.
In 1969, the first worldshop opened its doors in the Netherlands. The initiative aimed at bringing the principles of fair trade to the retail sector by selling almost exclusively goods produced under fair trade terms in "underdeveloped regions". The first shop was run by volunteers and was so successful that dozens of similar shops soon went into business in the Benelux countries, Germany, and other Western European countries.
Throughout the 1960s and 1970s, important segments of the fair trade movement worked to find markets for products from countries that were excluded from the mainstream trading channels for political reasons. Thousands of volunteers sold coffee from Angolaaa and Nicaragua in worldshops, in the back of churches, from their homes, and from stands in public places, using the products as an and vehicle to deliver their message: give disadvantaged producers in developing countries a fair chance on the world's market.
Handicrafts vs. agricultural goods
In the early 1980s, Alternative Trading Organizations faced major challenges: the novelty of some fair trade products began to wear off, demand reached a plateau, and some handicrafts began to look "tired and old fashioned" in the marketplace. The decline of segments of the handicrafts market forced fair trade supporters to rethink their business model and their goals. Moreover, several fair trade supporters during this period were worried by the contemporary effect on small farmers of structural reforms in the agricultural sector as well as the fall in commodity prices. Many of them came to believe it was the movement's responsibility to address the issue and remedies usable in the ongoing crisis in the industry.
In the subsequent years, fair trade agricultural commodities played an important role in the growth of many ATOs: successful on the market, they offered a much-needed, renewable source of income for producers and provided Alternative Trading Organizations a complement to the handicrafts market. The first fair trade agricultural products were tea and coffee, quickly followed by: dried fruits, cocoa, sugar, fruit juices, rice, spices and nuts. While in 1992, a sales value ratio of 80% handcrafts to 20% agricultural goods was the norm, in 2002 handcrafts amounted to 25% of fair trade sales while commodity food lines were up at 69%.
Rise of labeling initiatives
Sales of fair trade products only really took off with the arrival of the first Fairtrade certification initiatives. Although buoyed by ever growing sales, fair trade had been generally contained to relatively small worldshops scattered across Europe and to a lesser extent, North America. Some felt that these shops were too disconnected from the rhythm and the lifestyle of contemporary developed societies. The inconvenience of going to them to buy only a product or two was too high even for the most dedicated customers. The only way to increase sale opportunities was to start offering fair trade products where consumers normally shop, in large distribution channels. The problem was to find a way to expand distribution without compromising consumer trust in fair trade products and in their origins.
A solution was found in 1988, when the first Fairtrade certification initiative, Max Havelaar, was created in the Netherlands under the initiative of Nico Roozen, Frans Van Der Hoff, and Dutch development NGO Solidaridad. The independent certification allowed the goods to be sold outside the worldshops and into the mainstream, reaching a larger consumer segment and boosting fair trade sales significantly. The labeling initiative also allowed customers and distributors alike to track the origin of the goods to confirm that the products were really benefiting the producers at the end of the supply chain.
The concept caught on: in the ensuing years, similar non-profit Fairtrade labelling organizations were set up in other European countries and North America. In 1997, a process of convergence among labelling organizations – or "LIs" (for "Labeling Initiatives") – led to the creation of Fairtrade Labelling Organizations International (FLO). FLO is an umbrella organization whose mission is to set the Fairtrade standards, support, inspect and certify disadvantaged producers, and harmonize the Fairtrade message across the movement.
In 2002, FLO launched for the first time an International Fairtrade Certification Mark. The goals of the launch were to improve the visibility of the Mark on supermarket shelves, facilitate cross border trade, and simplify procedures for both producers and importers. At present, the certification mark is used in over 50 countries and on dozens of different products, based on FLO's certification for coffee, tea, rice, bananas, mangoes, cocoa, cotton, sugar, honey, fruit juices, nuts, fresh fruit, quinoa, herbs and spices, wine, footballs, etc.
With the rise of ethical labeling, consumers are able to take moral responsibility for their economic decisions and actions. This supports the notion of fair trade practices as "moral economies." The presence of labeling give consumers the feeling of "doing the right thing" with a simple purchase.
These labeling practices place the burden of getting certification on the producers in the Global South, furthering inequality between the Global North and the Global South. The process of securing certification is excessively burdensome and expensive. Northern consumers are able to just make a simple choice without these burdens and expenses.
Consumers of Fair Trade products usually make the intentional choice to purchase Fair Trade goods based on attitude, moral norms, perceived behavioral control, and social norms. It is useful to include of measure of moral norms to improve the predictive power of intentions to buy Fair Trade over the basic predictors, like attitude and perceived behavioral control.
University students have significantly increased their consumption of Fair Trade products over the last several decades. Women college students have a more favorable attitude than men toward buying Fair Trade products and they feel more morally obligated to do so. Women are also reported to have stronger intentions to buy fair trade products. When it comes to the intentions to buy Fair Trade products, gender had no direct effect.
Producers organize and strive for Fair Trade certification for several reasons, either through religious ties, wants for social justice, wants for autonomy, political liberalization, or simply because they want to be paid more for their labor efforts and products. Farmers are more likely to identify with organic farming than Fair Trade farming practices because organic farming is a very visible way that these farmers are different than their neighbors and it actually influences the way they farm. They place a significant importance on natural growing methods. Fair Trade farmers are also more likely to attribute their higher paid prices to the quality of their products rather than fair market prices.
Main article: Fair trade certification
Note: Customary spelling of Fairtrade is one word when referring to the FLO product labeling system, see Fairtrade certification
Fairtrade labelling (usually simply Fairtrade or Fair Trade Certified in the United States) is a certification system designed to allow consumers to identify goods which meet agreed standards. Overseen by a standard-setting body (FLO International) and a certification body (FLO-CERT), the system involves independent auditing of producers and traders to ensure the agreed standards are met. For a product to carry either the International Fairtrade Certification Mark or the Fair Trade Certified Mark, it must come from FLO-CERT inspected and certified producer organizations. The crops must be grown and harvested in accordance with the international Fair trade standards set by FLO International. The supply chain must also have been monitored by FLO-CERT, to ensure the integrity of the labelled product.
Fairtrade certification purports to guarantee not only fair prices, but also the principles of ethical purchasing. These principles include adherence to ILO agreements such as those banning child and slave labour, guaranteeing a safe workplace and the right to unionise, adherence to the United Nations charter of human rights, a fair price that covers the cost of production and facilitates social development, and protection and conservation of the environment. The Fairtrade certification system also attempts to promote long-term business relationships between buyers and sellers, crop prefinancing, and greater transparency throughout the supply chain and more.
The Fairtrade certification system covers a growing range of products, including bananas, honey, coffee, oranges, Cocoa bean, cocoa, cotton, dried and fresh fruits and vegetables, juices, nuts and oil seeds, quinoa, rice, spices, sugar, tea, and wine. Companies offering products that meet the Fairtrade standards may apply for licences to use one of the Fairtrade Certification Marks for those products. The International Fairtrade Certification Mark was launched in 2002 by FLO, and replaced twelve Marks used by various Fairtrade labelling initiatives. The new Certification Mark is currently used worldwide (with the exception of the United States). The Fair Trade Certified Mark is still used to identify Fairtrade goods in the United States.
There is widespread confusion because the fair trade industry standards provided by Fairtrade International (The Fairtrade Labelling Organization) use the word "producer" in many different senses, often in the same specification document. Sometimes it refers to farmers, sometimes to the primary cooperatives they belong to, to the secondary cooperatives that the primary cooperatives belong to, or to the tertiary cooperatives that the secondary cooperatives may belong to but "Producer [also] means any entity that has been certified under the Fairtrade International Generic Fairtrade Standard for Small Producer Organizations, Generic Fairtrade Standard for Hired Labour Situations, or Generic Fairtrade Standard for Contract Production." The word is used in all these meanings in key documents. In practice, when price and credit are discussed, "producer" means the exporting organization, "For small producers' organizations, payment must be made directly to the certified small producers' organization". and "In the case of a small producers' organization [e.g. for coffee], Fairtrade Minimum Prices are set at the level of the Producer Organization, not at the level of individual producers (members of the organization)" which means that the "producer" here is halfway up the marketing chain between the farmer and the consumer. The part of the standards referring to cultivation, environment, pesticides and child labour has the farmer as "producer".
WFTO Fair Trade Organization membership
In an effort to complement the Fairtrade product certification system and allow most notably handcraft producers to also sell their products outside worldshops, the World Fair Trade Organization (WFTO) launched in 2004 a new Mark to identify fair trade organizations (as opposed to products in the case of FLO International and Fairtrade). Called the FTO Mark, it allows consumers to recognize registered Fair Trade Organizations worldwide and seeks to guarantee that standards are being implemented regarding working conditions, wages, child labour, and the environment. The FTO Mark offers Fair Trade Organizations (including handcrafts producers) definable standards which inform consumers, business partners, governments, and donors of the applicable trading standard. in 2014 the Fairtrade Program Mark was introduced to create new sales opportunities, initially for cocoa, sugar and cotton producers. It has the same round logo alongside the word FAIRTRADE in black and underneath the program title in turquoise.
Alternative trading organizations
Main article: Alternative trading organization
An alternative trading organization (ATO) is usually a non-governmental organization (NGO) or mission-driven business aligned with the Fair Trade movement, aiming "to contribute to the alleviation of poverty in developing regions of the world by establishing a system of trade that allows marginalized producers in developing regions to gain access to developed markets". Alternative trading organizations have Fair Trade at the core of their mission and activities, using it as a development tool to support disadvantaged producers and to reduce poverty, and combine their marketing with awareness-raising and campaigning.
Alternative trading organizations are often, but not always, based in political and religious groups, though their secular purpose precludes sectarian identification and evangelical activity. Philosophically, the grassroots political-action agenda of these organizations associates them with progressive political causes active since the 1960s: foremost, a belief in collective action and commitment to moral principles based on social, economic and trade justice.
According to EFTA, the defining characteristic of alternative trading organizations is that of equal partnership and respect – partnership between the developing region producers and importers, shops, labelling organizations, and consumers. Alternative trade "humanizes" the trade process – making the producer-consumer chain as short as possible so that consumers become aware of the culture, identity, and conditions in which producers live. All actors are committed to the principle of alternative trade, the need for advocacy in their working relations and the importance of awareness-raising and advocacy work. Examples of such organisations are Ten Thousand Villages, Greenheart Shop, Equal Exchange and SERRV International in the US and Equal Exchange Trading, Traidcraft, Oxfam Trading, Twin Trading and Alter Eco in Europe as well as Siem Fair Trade Fashion in Australia.
The concept of a Fair Trade school or Fair Trade university emerged from the United Kingdom, where the Fairtrade Foundation now maintains a list of colleges and schools that comply with the needed requirements to be labeled such a university. In order to be considered a Fair Trade University, a school or university must have established a Fairtrade School Steering Group. They must have a written and implemented a school-wide Fair Trade Policy. The school or university must be dedicated to selling and using Fair Trade products. They have to learn and educate about Fair Trade issues. Finally, the Fairtrade Foundation requires that schools promote Fair Trade not only within the school, but throughout the wider community.
A Fair Trade University is one that develops all aspects of Fair Trade practices in their coursework. In 2007, the Director of the Environmental Studies program at the University of Wisconsin-Oshkosh, David Barnhill, started a push to become the first Fair Trade University. This push received positive reactions from faculty and students. To begin the process, the University as a whole agreed that it would need support from four institutional groups—faculty, staff, support staff, and students—to maximize support and educational efforts. The University officially endorsed the Earth Charter and created a Campus Sustainability Plan to align with the efforts of becoming a Fair Trade University.
The University of Wisconsin- Oshkosh also offers many courses in many different disciplines that implement fair trade learning. They offer a business course with a trip to Peru to visit coffee farmers, an environmental science class that discusses fair trade as a way for cleaner food systems, an English course that focuses on the Earth Charter and the application of fair trade principles, and several upper-level anthropology courses make fair trade the center of the class.
In the spring of 2010, the University of California, San Diego became the second Fair Trade University in the United States. The University of California at San Diego understood the efforts of the Fairtrade Foundation in the UK, but they recognized they wanted to be more detailed about how their declaration as a Fair Trade University would make an actual change in the way on-campus franchises do business with the university. They also required constant assessment and improvement. The main premise of being a Fair Trade University for the University of California at San Diego is the promise between the university and the students about the continual effort by the university to increase the accessibility of Fair Trade Certified food and drinks and to encourage sustainability in other ways, such as buying from local, organic farmers and decreasing waste.
Fair Trade Universities have been successful because they are a "feel good" movement. The movement also has an established history, making it a true movement rather just a fad. Thirdly, Fair Trade Universities are effective because they raise awareness about an issue and offer a solution. The solution is an easy one for college students to handle, just paying about five cents more for a cup of coffee or tea can make a real difference.
Main article: Worldshop
Worldshops or fair trade shops are specialized retail outlets offering and promoting fair trade products. Worldshops also typically organize various educational fair trade activities and play an active role in trade justice and other North-South political campaigns. Worldshops are often not-for-profit organizations and run by locally based volunteer networks. Although the movement emerged in Europe and a vast majority of worldshops are still based on the continent, worldshops can also be found today in North America, Australia and New Zealand.
Worldshops' aim is to make trade as direct and fair with the trading partners as possible. Usually, this means a producer in a developing country and consumers in industrialized countries. The worldshops' target is to pay the producers a fair price that guarantees substinence and guarantees positive social development. They often cut out any intermediaries in the import chain. A web movement has begun in the 2000s to provide fair trade items at fair prices to the consumers. One popular one is Fair Trade a Day where a different fair trade item is featured each day.
Every year the sales of Fair Trade products grow close to 30% and in 2004 were worth over $500 million USD. In the case of coffee, sales grow nearly 50% per year in certain countries. In 2002, 16,000 tons of Fairtrade coffee was purchased by consumers in 17 countries. "Fair trade coffee is currently produced in 24 countries in Latin America, Africa and Asia". The 165 FLO associations in Latin America and Caribbean are located in 14 countries and together export over 85% of the world's Fair Trade coffee. There is a North/South divide of fair trade products with producers in the South and consumers in the North. Discrepancies in the perspectives of these southern producers and northern consumers are often the source of ethical dilemmas such as how the purchasing power of consumers may or may not promote the development of southern countries. Amidst the continuous growth, "[p]urchasing patterns of fairtrade products have remained strong despite the global economic downturn. In 2008, global sales of fairtrade products exceeded US$ 3.5 billion."
Africa's exports come from the places such as South Africa, Ghana, Uganda, Tanzania and Kenya. These exports are valued at $24 million USD. Between the years of 2004 and 2006 Africa quickly expanded their number of FLO certified producer groups, rising from 78 to 171; nearly half of which reside in Kenya, following closely behind are Tanzania and South Africa. The FLO products Africa is known for are tea, cocoa, flowers and wine. In Africa there are smallholder cooperatives and plantations which produce Fair Trade certified tea. Cocoa-producing countries in West Africa often form cooperatives that produce fair trade cocoa such as Kuapa Kokoo in Ghana. West African countries without strong fair trade industries are subject to deterioration in cocoa quality as they compete with other countries for a profit. These countries include Cameroon, Nigeria, and the Ivory Coast.
Studies in the early 2000s show that the income, education and health of coffee producers involved with Fair Trade in Latin America were improved, versus producers who were not participating. Brazil, Nicaragua, Peru and Guatemala, having the biggest population of coffee producers, make use of some of the most substantial land for coffee production in Latin America and do so by taking part in Fair Trade. Countries in Latin America are also large exporters of fair trade bananas. The Dominican Republic is the largest producer of fair trade bananas, followed by Mexico, Ecuador, and Costa Rica. Producers in the Dominican Republic have set up associations rather than cooperatives so that individual farmers can each own their own land but meet regularly. Fundación Solidaridad was created in Chile to increase the earnings and social participation of handicraft producers. These goods are marketed locally in Chile and internationally. Fair trade handicraft and jewellery production has also shown a significant uplift over recent years, aided by North American and European online retailers developing direct relationships to import and sell the products online. The sale of fair trade handicrafts online has been of particular importance in aiding the development of female artisans in Latin America
The Asia Fair Trade Forum aims to increase the competency of fair trade organizations in Asia so they can be more competitive in the global market. Garment factories in Asian countries including China, Burma, and Bangladesh consistently receive charges of human rights violations, including the use of child labour. These violations conflict with the principles outlined by fair trade certifiers. In India, Trade Alternative Reform Action (Tara) Projects formed in the 1970s have worked to increase production capacity, quality standards, and entrance into markets for home-based craftsmen that were previously unattainable due to their lower caste identity.
The Fair Trade Association of Australia and New Zealand (FTAANZ) is a member-based organization that supports two systems of fair trade. The first is the Australia and New Zealand member of FLO International, which unites Fairtrade producer and labelling initiatives across Europe, Asia, Latin America, North America, Africa, Australia and New Zealand. The second, is the World Fair Trade Organization (WFTO), of over 450 worldwide members, to which FTAANZ is one. Fairtrade (one word) refers to FLO certified commodity and associated products. Fair trade (two words) encompasses the wider Fair Trade movement, including the Fairtrade commodities and other artisan craft products.
Fair trade commodities are goods that have been exchanged from where they were grown or made to where they are purchased, and have been certified by a fair trade certification organization, such as Fair Trade USA or World Fair Trade Organization. Such organizations are typically overseen by Fairtrade International. Fairtrade International sets international fair trade standards and supports fair trade producers and cooperatives. Sixty percent of the fair trade market revolves around food products such as coffee, tea, cocoa, honey, and bananas. Non-food commodities include crafts, textiles, and flowers. It has been suggested by Shima Baradaran of Brigham Young University that fair trade techniques could be productively applied to products which might involve child labor. Although fair trade represents only .01% of the food and beverage industry in the United States, it is growing rapidly and may become a significant portion of the national food and beverage industry.