Is Fair Trade Really Fair?
June 3, 2014

Is Fair Trade Really Fair?

The problem with “ethical” products is not just the premium price you usually have to pay to buy them, there is also a constant nagging doubt in the back of your mind – do they really work? Do they deliver on their promises? It might be tea, coffee, flowers, sustainable fish products like line-caught tuna or those Fair trade bananas with a considerable price hike. No one in their right minds would pay the price if they did not believe they were really benefiting the people whose labor actually produces the goods. Now a new study has cast doubt on Fair Trade’s claims of helping those agricultural workers that we all believe benefit most.

The four-year research program was carried out by London’s School of Oriental and African Studies (SOAS). The “Fair Trade, Employment and Productivity Reduction Project” (FTEPRP) took place in Ethiopia and Uganda with the help of funding from the UK’s Department for International Development (DFID).

Fair Trade itself states on its website that it is “about better prices, decent working conditions, local sustainability, and fair terms of trade for farmers and workers in the developing world.” One would expect from this that workers in Fair Trade-supported businesses would be better off than those who are not part of a Fair Trade project. However, Professor Christopher Cramer, who was involved in FTEPRP, writes in the UK’s Guardian newspaper that in many cases the very opposite might be true.

In the areas covered by the research, manual agricultural workers were among the poorest groups with lower incomes, inferior diet, fewer possessions, and less education — especially for women. Given the often seasonal and casual nature of agricultural work, this was no real surprise. What was surprising, however, was that wages and conditions for workers in areas with Fair Trade organizations were poorer than in non-Fair Trade areas. In the final report, researchers claim that they were “unable to find any evidence that Fair Trade has made a positive difference to the wages and working conditions of those employed in the production of the commodities produced for Fair Trade certified export.” While not criticizing Fair Trade’s good intentions, the report suggests that, in some instances, the extra money paid for Fair Trade labelled goods is not reaching those who need it most and that a lot of money gets diverted to producers and projects with no real benefit for the poorest workers. There is no suggestion that Fair Trade-endorsed operations actually cause the problems the report identified.

In truth, this a complex subject and making realistic comparisons between businesses that vary widely in both size and methods of production is difficult. Fair Trade has responded to the criticism and points out what they see as contradictions and failings in the report. They do though acknowledge that “agricultural [laborers] are extremely poor, and we agree that more needs to be done to help them.” There is no doubt that a lot of Fair Trade money does make a positive difference to many workers and farmers (1.4 million in 70 countries according to their own figures). Fair Trade has been in existence for 25 years and is now a multi-billion dollar operation. Its own research shows that many people have gained from improved incomes and conditions, as well as Fair Trade-funded schools, health provision, social projects, and sanitation. So, for now then, I personally feel comfortable continuing to buy Fair Trade goods, but with the hope that they can take onboard and learn from the FTEPRP conclusions.

Image Credit: Thinkstock

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Eric Hopton is a writer, musician, artist, and photographer. He has a degree in Social Anthropology and has always been passionate about travel, having so far visited 73 countries. His music and sound work has been used in many projects around the world and can be heard on Bandcamp and Freesound, where he has contributed over 1,300 sounds under his sonic alter ego, ERH.

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