Environmental Engineering Reference
In-Depth Information
Fair trade principles and parameters
The fair trade movement has grown out of a set of North American and European ini-
tiatives seeking to transform North-South trade from a vehicle of exploitation to one of
sustainable development (Renard, 2003). Operating initially in the handicraft sector, alter-
native trade organizations support disadvantaged producers by buying products at above-
market prices and selling them directly to ethically aware consumers. In this way fair trade
networks are designed to 'shorten the distance' between producers and consumers
(Raynolds, 2002). Over the past 25 years, fair trade has expanded into major food com-
modities and fair trade certi
ed foods are now sold in conventional retail venues
(Raynolds and Long, 2007). Fair trade groups have aligned under the FINE umbrella,
2
forging a common de
fi
fi
nition of fair trade:
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 - espe-
cially in the South. Fair Trade organisations (backed by consumers) are engaged actively in sup-
porting producers, awareness raising and in campaigning for changes in the rules and practice
of conventional international trade. (FINE, 2003)
As this statement suggests, fair trade operates both 'in and against the market'. While it
utilizes market channels to create new commodity networks for items produced under
more favorable social and ecological conditions, fair trade operates against conventional
market forces that create and uphold global inequalities (Raynolds, 2000; 2002).
Fairtrade Labeling Organizations International (FLO), the non-governmental organi-
zation that coordinates fair trade labeling, operates in 20 countries across Europe, North
America and the Paci
ed
under the FLO system comprise the lion's share of the fair trade market.
3
As noted in
Table 17.1, the USA represents the largest and most rapidly growing market for certi
fi
c. With earnings over US$1.4 billion per year, products certi
fi
ed
fair trade products, with annual sales worth US$428 000 and a growth rate of 60 percent
per year. The UK, Switzerland, France and Germany follow with the next-largest fair
trade markets. Initially available only in small alternative shops, fair trade products are
now sold by giant retailers and even by fast food chains (Raynolds et al., 2007). The rapid
growth of fair trade sales has been fueled by increasing consumer concern over the envi-
ronmental and social impacts surrounding global trade.
fi
Ta ble 17.1 Fair trade certified sales in major markets (US$1000)
2005
% annual increase (2004-05)
USA
428 000
60
UK
345 000
35
Switzerland
178 000
5
France
136 000
57
Germany
88 000
23
Total
1421 000
37
Source:
FLO-I (2006a).
