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Fair trade is a term for an arrangement designed to help producers in developing countries achieve sustainable and equitable trade relationships. The fair trade movement combines the payment of higher prices to exporters with improved social and environmental standards. The movement focuses in particular on commodities, or products that are typically exported from developing countries to developed countries but are also used in domestic markets (e.g., Brazil, the United Kingdom and Bangladesh), most notably for handicrafts, coffee, cocoa, wine, sugar, fruit, flowers and gold.[1][2]
Fair trade labelling organizations commonly use a definition of fair trade developed by FINE, an informal association of four international fair trade organizations: Fairtrade International (formerly called FLO, Fairtrade Labelling Organizations International), World Fair Trade Organization (WFTO), Network of European Worldshops and European Fair Trade Association (EFTA). Fair trade, by this definition, is a trading partnership based on dialogue, transparency and respect, that seeks greater equity in international trade. Fair trade organizations, backed by consumers, support producers, raise awareness and campaign for changes in the rules and practice of conventional international trade.[3]
Fair trade certifiers include Fairtrade International, Ecocert, Fair World Project and Fair Trade USA, whose labelling scheme includes independent smallholders and estates for crops. In 2008, Fairtrade International certified approximately (€3.4B) of products.[4][5]
On 6 June 2008, Wales became the world's first Fair Trade Nation[clarification needed]; followed by Scotland in February 2013.[6][7][8] The fair trade movement is popular in the UK, where there are over 500 Fairtrade towns[clarification needed], 118 universities, over 6,000 churches, and over 4,000 UK schools registered in the Fairtrade Schools Scheme[clarification needed].[9] In 2011, more than 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.[10]
Some criticisms have been raised about fair trade systems, including that fair trade certification did not lead to financial benefit to producers or improvement in working conditions, and that fair trade certification resulted in greater inequalities in some markets.
A proposed alternative to fair trade is direct trade, which eliminates the overhead costs of the fair trade certification and allows suppliers to receive higher prices 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 systems.
- ^ Brough, David (January 10, 2008), "Briton finds ethical jewellery good as gold", Reuters, NA, archived from the original on August 12, 2011, retrieved July 1, 2010
- ^ Moseley, WG (2008), "Fair Trade Wine: North Africa's Post Apartheid Vineyards and the YouTube Global Economy", Globalizations, 5 (2): 291–304, doi:10.1080/14747730802057753, S2CID 154416345
- ^ What (PDF), European fair trade association, archived from the original (PDF) on 2007-07-12, retrieved 2009-05-04
- ^ Facts & figures, Fair trade, archived from the original on 2013-04-24, retrieved 2013-05-07
- ^ "General overview" (PDF). WTO. 2006. p. 3. Archived (PDF) from the original on 2020-09-19. Retrieved 2006-12-31.
- ^ "Scotland as a Fair Trade Nation – Social Responsibility and Sustainability". blogs.ed.ac.uk. Archived from the original on 2022-02-07. Retrieved 2022-02-07.
- ^ "Wales made fair trade 'pioneer'". BBC News. BBC News. Archived from the original on 20 September 2021. Retrieved 20 September 2021.
- ^ "Wales as a Fair Trade Nation". Fair Trade Wales. Fair Trade. Archived from the original on 20 September 2021. Retrieved 20 September 2021.
- ^ Paull, J (2011), "The Fairtrade movement: Six lessons for the organics sector" (PDF), Proceedings of the Third Scientific Conference of the International Society of Organic Agriculture Research, Namyangju, Korea, pp. 317–20, archived (PDF) from the original on 2012-06-10, retrieved 2011-12-17
{{citation}}: CS1 maint: location missing publisher (link) - ^ Annual report (PDF), Fair trade, 2009, archived (PDF) from the original on 2014-08-01, retrieved 2014-05-01