Fair Trade

"Fair trade" is an example of development occurring through trading relationships and improved commercial opportunities 

• to bridge the gap between developed and developing countries 
• to facilitate the better integration of developing countries in the world economy.

The objective of fair trade is to ensure that producers receive a price which reflects an adequate return on their input of skill, labour and resources, and a share of the total profit commensurate with their input.

This is normally effected through an agreement by the participants in the fair trade initiative to pay a fair price which is negotiated on a case by case basis. In situations where the price of goods is agreed internationally (e.g. coffee), a minimum price is set so that producers receive a return above the world price for their produce.

Fair trade gives producers in developing countries higher revenues for their goods as well as increased opportunities to find new markets. It aims to alleviate the social conditions by enhancing sound economic development and sustainable growth from the bottom up. It also hopes to reduce some of the disparities that have evolved over the decades between industrialised and developing countries as a result of the relative decrease in the prices of basic and notably agricultural commodities.

Fair trade initiatives are incentive-based: they rely on consumer choice and do not manage trade or otherwise erect barriers to market access in different countries. Consumers are therefore given the opportunity to increase the standard of living and quality of life of producers in developing countries through a sustainable market-oriented approach.

Making Global Trade Work for People Kamal Malhotra, Senior Advisor on Inclusive Globalization in UNDP’s Bureau

What role for fair trade in EU Policies? Statement by Pascal Lamy at panel Conference on Fair trade a contribution to sustainable development European Parliament, Brussels 23 March 2004
Communication from the Commission to the Council on "fair trade", 29-11-99


Rigged Rules and double standards, trade, globalisation and fight against poverty, Oxfam

How does fair trade work in practice?
The FAIRTRADE Mark is an independent consumer label which appears on products as an independent guarantee that disadvantaged producers in the developing world are getting a better deal.
For a product to display the FAIRTRADE Mark it must meet international Fairtrade standards. These standards are set by the international certification body Fairtrade Labelling Organisations International (FLO).
Producer organisations that supply Fairtrade products are inspected and certified by FLO. They receive a minimum price that covers the cost of sustainable production and an extra premium that is invested in social or economic development projects.
Fairtrade Products:
Bananas
Citrus
Coffee
Cotton
Tea
Mangoes
Sugar
Fruit juice
Honey
Snacks
Chocolate and cocoa
Roses
Sports balls
Wines and beers