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Pros And Negatives Of Fair Trade

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Introduction
Fair trade is the concept of paying small farmers in developing countries better prices and substitutions to improve their producing and living standards. The World Fairtrade Organization (WFTO) defines it as “a trading partnership [...] that seeks greater equity in international trade. It contributes to sustainable development […] of marginalized producers and workers – especially in the South.” [Sarcauga, 2015] This assignment will describe some positive and negative factors of fair trade to clarify whether it is as fair as it states.

Facts about fair trade and “The Fairtrade Foundation”
In the early 1980s, fair trade wasn't as well-known as it is today. Several little organizations cared for the farmers of Third World countries …show more content…

The Fairtrade Foundation sets a minimum price, for example £1 for one kilogram of coffee. If the market price is under the fair trade minimum price, in this example £0.75, the farmer will still get £1 and therefore 25 Pence more than his competitors. If the market price exceeds the set price, for instance £1.50, the farmer gets the higher market price. This system is meant to be as a security net [Hesketh-Rowe, 2015; Macatonia, 2014]. In this way, the farmer can plan his future cropping and has not to worry about his next harvest as he would have to if he had not a secured minimum price. Through the guaranteed price set by the fair trade Foundation there are fair pay and working conditions on the farms what leads to a better work environment and less exploitation [Fairtrade Resource Network, 2008]. Eileen Maybin, member of The Fairtrade Foundation, says that “fair trade focuses on ensuring that farmers in developing countries receive an agreed and stable price for the crops they grow.” [O'Neill,

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