What is Fair Trade and Why is it Important?

According to Meera Warrier, the concept of Fair Trade started in the 1970's, when Fair Trade campaigners began to argue that "the market confines poor countries to export goods whose prices are historically vulnerable to fluctuations. Furthermore, the internationalization of production has led to the exploitation of workers in the developing world, leading to a lowering of labour standard and wages." (2011:3)

Fairtrade Canada defines "Fair Trade" as "the broader concept of fairness and decency in the marketplace, where as "Fairtrade" refers to the specific Fair Trade certification system run by Fairtrade International (FLO) and it's members, including Fairtrade Canada." (2011)

Fair Trade Canada's logo
http://fairtrade.ca/en/about-fairtrade/what-fair-trade

Fairtrade International says that "When a product carries the FAIRTRADE Mark it means the producers and traders have met Fairtrade Standards. The Standards are designed to address the imbalance of power in trading relationships, unstable markets and the injustices of conventional trade. " (Fairtrade International: 2011)

There have been several standards put in place in order to keep Fair Trade fair, and to ensure that the farmers and producers are getting the shares they deserve, and most of these standards focus on pricing. John Bowes explains that "The FAIRTRADE Mark represents a visual guarantee that a product has met international Fairtrade standards. These include a guaranteed minimum price set at a level which ensures that the producer is able to cover all costs necessary for sustainable production." (2010:5) Fairtrade Canada notes that "These standards focus on the terms of trade- specifically they spell out the minimum prices that can be paid to producers, the expectation for longer-term contracts, and the requirements to provide up to 60% of the value of a contract in advance should the producers request." (Fairtrade Canada: 2011) Companies are also monitored to make sure they are marketing the correct products as Fair Trade and to ensure that they are using the Fairtrade symbol appropriately.

Fair Trade is most important to consumers because, as Fairtrade International states, "Small farmer groups must have a democratic structure and transparent administration in order to be certified. Workers must be allowed to have representatives on a committee that decides on the use of Fairtrade Premium." (Fairtrade International:2011) Fair Trade is also important because it covers the minimum costs of sustainable production and it helps the producers to improve their quality of life by giving them a stable income that they can invest in education, healthcare and improvements to facilities in their communities. But not only is it beneficial to the producers, but to consumers as well. Fair Trade is important to many consumers they "can buy products inline with their values and principle"(Fairtrade International: 2011) 

References 

Bowes, John
   2010 Fair Trade Revolution. London: Pluto Press

Fairtrade Canada

   2011 What is Fair Trade? http://fairtrade.ca/en/about-fairtrade/what-fair-trade

Fairtrade International
   2011 Introducing Fairtrade http://www.fairtrade.net/what_is_fairtrade.html

Warrier, Meera

   2011 The Politics of Fair Trade: a Survey. Florence, Kentucky: Routledge