Fairtrade: there’s no magic wand

YOUR feature (June 8) asked ‘How fair is fair trade?’ and went on to cite various criticisms of fairtrade that have been made in the media over the past year.

Fairtrade is a system that was set up to ensure farmers and workers in developing countries receive a fair deal for the goods they sell with the Fairtrade mark.

It does this mainly by setting guaranteed minimum prices and paying an extra social premium or bonus that can be used for local development.

It is estimated that the sale of products with the Fairtrade mark gave an extra €100m in 2006 to farmers in some of the poorest countries in the world, a significant sum in countries where annual per capita incomes can be as low as €300-€400 a year.

However, Fairtrade has no magic wand: it benefits people in direct proportion to the volume of goods sold on Fairtrade terms. Some farmers sell large volumes and gain proportionately. Unfortunately, many others sell smaller volumes and benefit much less. Many of the criticisms mentioned in your feature have this fact at their root.

The recent Channel 4 documentary was about two tea estates in India that are Fairtrade-certified — but where both estates sell hardly anything (only 1% and 3%, respectively) on Fairtrade terms. Wouldn’t it have been more accurate if Channel 4 had identified the problems on the estate as being the result of them selling 99% and 97% of their tea on ordinary commercial terms at apparently ever-declining prices?

In relation to the Financial Times article about workers on Fairtrade-certified coffee farms not being paid the minimum wage in Peru, all workers hired directly by farmers’ organisations must be paid legal minimum wages. Fairtrade inspects against this and treats non-compliance with great seriousness.

However, on payment of temporary workers by individual small farmers, Fairtrade recognises that farmers who sell only a small proportion of their crop on Fairtrade terms will often struggle to earn the minimum wage themselves.

That’s why our standards state that they must share any benefits of Fairtrade and progressively improve working conditions. These farms were paying workers 25% above what they could get elsewhere, despite selling just 10%-15% of their total crop on Fairtrade terms.

It’s not enough, but these kinds of situations are surely an argument for increasing the volume of goods sold with the Fairtrade mark?

And this is where consumers play their part. Irish consumers have shown themselves up to the challenge when given the opportunity.

Peter Gaynor

Executive Director

Fairtrade Mark Ireland

Carmichael House

North Brunswick Street

Dublin 7