Fairtrade is an initiative which tries to improve conditions of farmers and workers in the developing world.[1]
Historically, two generations of Fairtrade can be pinpointed. At the beginning, non lucrative organizations bought products from the associated producers and sold them directly to consumers. These organizations explained origin of products and why their price was higher (generally 20% up) than the price of the same product in the traditional market. Part of the gain (10%) came back to producers and the other part was invested in Fairtrade awareness campaigns. The second generation of Fairtrade means the enter of lucrative companies into the process through the International Fairtrade Certifications. Products which have this label are Fairtrade products.
The current Fairtrade has achieved the creation of opportunities to small scale producers who can now export their products in good conditions without being discriminated for any reason. In addition, producers have better wages which allow them to get access to some essential services that they did not have before ( electricity, ambulances…) All of this apparently implies a better distribution of the wealth and recognition of producers´ social rights.
However, Fairtrade system has some defects. For instance, most of Fairtrade products are bought from certain geographical regions.[2] Furthermore, the most important can be that an unreasonable use of International Fairtrade Certifications is been observed. [3]: Gains do not actually come back to producers which means an over profit for companies.
In conclusion, as demonstrated, Fairtrade is helping developing countries to improve BUT unfair enrichment of companies should be regulated.[4]
In this context, which is the position of WTO? The Organization keeps silent on Fairtrade aims and as it was established, civil society networks[5] are heading Fairtrade projects. Furthermore, WTO constricts the right to build regional agreements by very strict principles, that state that does should not be "trade diverting" and that obligations between signing parts should be as strict as WTO obligations are. This is a big issue for Fairtrade because creating opportunities for small-scale producers means positive discrimination and flexible agreements according to solidarity behaviour patterns. However, WTO seems to be worried just about trade as an aim itself.[6]
[1] http://www.fairtrade.org.uk/what_is_fairtrade/default.aspx
[3] ESPANICA, ‘ El comercio justo: origen y evolución’
[4] The economist, ‘Voting with your trolley: can you really change the world just by buying certain foods?’(2006) 8507 (381) THE ECONOMIST 73.
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