The Basics of Fair Trade History

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The Basics of Fair TradeHistory ImpactLucas
Caldeira
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The Basics of Fair Trade
Trade
Engine of Growth Helps raise wages/salaries
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The Basics of Fair Trade

• The trade theory is based on the assumptions
  that
• perfect market information
• perfect access to markets and credit
• strong capacity to adapt production techniques
  and outputs in response to market information

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The Basics of Fair Trade

• These conditions
• perfect market information
• perfect access to markets and credit
• strong capacity to adapt production techniques
  and outputs in response to market information

NOT PRESENT in agricultural societies
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The Basics of Fair Trade

• Fair trade - an alternative model which attempts
  to address the failures of conventional trade by
  
• assuring producers a stable price for their
  crop/products
• providing them better trading conditions,
  business support and access to markets in
  developed countries

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The Basics of Fair Trade
Definition of Fair Trade a trading
partnership which seeks greater equity in
North-South trade. It contributes to sustainable
development by offering better trading conditions
to, and securing the rights of, disadvantaged
producers especially in the South. supports
producers in - raising awareness -
campaigning for changes in the rules and
practice of conventional trade
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The Basics of Fair Trade

• History of Fair Trade
• First fair trade activities began in the late
  1940s in America a volunteer from a church
  based organization called the Mennonite Central
  Committee (MCC), on her travels to Puerto Rico,
  took embroidery samples to the U.S. and sold them
  there (to improve students livelihoods) ? became
  an official program Self-Help Crafts of the
  World

• in 1996, it was reborn as Ten Thousand Villages
  with a network of 150 fair trade shops in America
  today.

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The Basics of Fair Trade

• History of Fair Trade
• In the late 1950s in Europe, Oxfam started to
  sell in the U.K. crafts made by Chinese refugees
  in Hongkong.
• First product a stuffed pin cushion.
• Parallel initiatives took place in Netherlands.
  Civic groups started to sell cane sugar with the
  message By buying cane sugar, you give poor
  countries a place in the sun of prosperity.

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The Basics of Fair Trade

• History of Fair Trade
• 1967 first fair trade importing organization was
  established in the Netherlands. This is the Fair
  Trade Organisatie (FTO). Now, FTO stands for
  Fair Trade Original.
• At the same time, the first fair trade retail
  shop known as WorldShop was opened for many
  years, fair trade was confined to this
  alternative trading circuit composed of the small
  Southern producers, fair trade importers and
  retailers, and consumers in the charity craft
  market.

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The Basics of Fair Trade

• History of Fair Trade
• Late 1970s unregulated competition in global
  commodity markets significantly decreased prices
  of many agricultural products of developing
  countries (sugar, cotton, cocoa and coffee by as
  much as 30-60)
• drove millions of small producers down the
  poverty line ? a fair trade certification and
  labeling system was slowly developed based on the
  concept of a minimum price to farmers.
• In 1988, the Max Havelaar labeled coffee began
  to be sold in supermarkets and other commercial
  retail outlets in Netherlands.

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The Basics of Fair Trade

• History of Fair Trade
• Following the example in Netherlands, other
  countries created their own national labeling
  initiatives.
• 1997, the Fairtrade Labeling Organization
  International (FLO) was created as an umbrella
  organization of national labeling initiatives
  whose mission is to harmonize fair trade
  standards and certify.

FLO
Labeling Initiatives
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History of Fair Trade

• Then in the 1980s and 1990s, the
• following organizations were berthed
• FLO created in 1997 an association of 3 producer
  networks and 20 national labeling organizations
• IFAT founded in 1989 as a global association of
  fair trade producer organizations and networks
  with NOW over 300 member organizations in 60
  countries.

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Fair Trade Structures
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Fair Trade Structures

• LABELING INITIATIVES
• Fairtrade Label guarantees that the product
  conforms to Fairtrade standards contributes to
  the development of disadvantaged producers
• this scheme has been adopted in many countries,
  mainly throughout Europe and North America

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Fair Trade Structures
LABELING INITIATIVES The first labeling scheme
was developed under Max Havelaar in the
Netherlands in 1988
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200 importer-distributors dealing exclusively
with Fairtrade products
1500 commercial importers / distributors
selling a substantial percent of Fairtrade
products
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3000 World shops in Europe almost exclusively
retailing Fair trade products
80,000 supermarkets in Europe, North America and
Pacific Rim carrying fair trade products on their
shelves
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In 2006, the fair trade system benefited 1.4
million workers and farmers in Africa, Asia and
Latin America
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The Basics of Fair Trade

• Principles of
• Fair Trade
• Creation of opportunities for economically
  disadvantaged producers
• Transparency accountability
• Capacity building
• Payment of a fair price
• Safe and healthy working conditions
• Environmental sustainability
• Promoting gender equality

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The Basics of Fair Trade

• Challenges of
• Fair Trade
• Ensuring that the benefits of fair trade accrue
  to the disadvantaged producers
• Maintaining the credibility and integrity of the
  fairtrade certification and labeling system
• Increasing market share and developing new
  markets

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End of Presentation