Consuming Issues: Let's be fair to Fairtrade - it can reduce poverty

Even buying tea and coffee poses a dilemma these days: do you pick up the virtuous but more expensive Fairtrade packs which promise to help poor foreign farmers, or do you quietly pocket the cash and buy a normal product? This week some national newspapers may have given the impression that you needn't bother buying Fairtrade.

A report by the London-based think-tank the Institute of Economic Affairs, called Fair Trade Without The Froth, by Dr Sushil Mohan of Dundee University, cast doubt on the fast-growing movement and was given an airing in several newspapers. Quite right, too, for the good reason of balance, given the number of highly supportive pieces about Fairtrade that appear in the media.

Nonetheless, the 134-page report was not quite as damning as readers may have been led to believe. The headline on page two of Thurday's Guardian was "Costly Fairtrade Foundation accused of failing coffee farmers". The first sentence read: "Multinational companies such as Starbucks, Kraft and Nestlé do more for coffee farmers than the Fairtrade Foundation, according to a critical report from a free-market think-tank."

Now, I've read the report (from an organisation wary of a movement that criticises international trade) and, actually, it's not that critical at all. In fact, it doesn't seriously question that Fairtrade sends back more cash to farmers than they would receive if they sold their products on the open market, even taking into account the costs of forming themselves into co-operatives and obtaining certification as suppliers.

In case you don't believe me, this is one of the report's conclusions: "There is no question that Fairtrade will help some producers, and it may help [to] build more general business capacity that improves the prospects for development more generally within the communities within which it operates. It is a strategy for development that may well help seven million or more people in this way."

Instead, Dr Mohan comes up with a series of quibbles about different aspects of Fairtrade, none of which alters the central fact that it helps poor farmers. Here are a few:

* Fairtrade's marketing undermines the far greater benefits arising from (more plentiful) ordinary free trade;

* Fairtrade is concentrated in middle-income states rather than the very poorest ones;

* Fairtrade imposes costly demands on farmers that force them to spend money on becoming certified;

* Academic studies suggest that only 10 to 25 per cent of the extra money charged for Fairtrade products goes back to farmers; retailers and others pocket much of the rest.

Overall, Dr Mohan concludes that Fairtrade, while doing some good, is small and accounts for only 0.01 per cent of global food and beverage sales. Development and the removal of western trade barriers can, and will, help developing countries more than Fairtrade, he argues. Now, there is no time to answer each point, but let us look at the report's central charge: that Fairtrade is not "a poverty panacea or general long-term development strategy".

Well, Fairtrade alone cannot save the world, that's for sure. But it is still a neat idea: shoppers opt to pay more for commodities so that more money is returned to the farmers who grow them. Certainly, it is a shame that not all of the premium charged in the shops goes back (though sometimes there is no premium) but the little extra that goes back goes a long way; it makes the difference between grinding poverty and comfortable subsistence, where school and hospital fees can be paid and glass put into the windows of homes. Fairtrade isn't perfect, but as the cotton growers of Mali or coffee growers of Tanzania or sugar planters of Belize would point out, it is not a perfect world.

m.hickman@independent.co.uk

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Life and Style
Angel Di Maria is shown the red card
tech
Sport
Roger Federer after his win over Tomas Berdych
sport
Life and Style
News in briefs: big pants in 'Bridget Jones's Diary'
fashionBig knickers are back
Sport
James Milner is set to sign for Liverpool this week despite rival interest from Arsenal
sportReds baulk at Benteke £32.5m release clause
News
The controversial Motor Neurone Disease Association poster, featuring sufferer Michael Smith, has drawn a series of angry complaints
newsThis one has been criticised for its 'threatening tone'
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Payments Operations Assistant

    £23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

    Recruitment Genius: Telephone Debt Negotiator

    £13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

    Guru Careers: Communications Exec / PR Exec

    £25 - £30K: Guru Careers: We are seeking a highly-motivated and ambitious Comm...

    Guru Careers: Pricing Analyst

    £30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

    Day In a Page

    On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

    On your feet!

    Spending half the day standing 'reduces risk of heart attacks and cancer'
    Liverpool close in on Milner signing

    Liverpool close in on Milner signing

    Reds baulk at Christian Benteke £32.5m release clause
    With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

    The big NHS question

    Why are there so few new GPs when so many want to study medicine?
    Big knickers are back: Thongs ain't what they used to be

    Thongs ain't what they used to be

    Big knickers are back
    Thurston Moore interview

    Thurston Moore interview

    On living in London, Sonic Youth and musical memoirs
    In full bloom

    In full bloom

    Floral print womenswear
    From leading man to Elephant Man, Bradley Cooper is terrific

    From leading man to Elephant Man

    Bradley Cooper is terrific
    In this the person to restore our trust in the banks?

    In this the person to restore our trust in the banks?

    Dame Colette Bowe - interview
    When do the creative juices dry up?

    When do the creative juices dry up?

    David Lodge thinks he knows
    The 'Cher moment' happening across fashion just now

    Fashion's Cher moment

    Ageing beauty will always be more classy than all that booty
    Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

    Health fears over school cancer jab

    Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
    Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

    'I forgive everyone, but I don't forget'

    Fifa president Sepp Blatter issues defiant warning to opponents
    Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

    Weather warning

    Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
    LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

    High hopes for LSD

    Meet the volunteer users helping to see if it cures depression and addiction
    German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

    Saving Private Brandt

    A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral