The LexGaze Weekly - COVER STORY

Fair trade: The war that never ends!

Mr Aditya Raghu Rayee

Oct 11, 2020

Issue 17

“We believe that beautiful things are more beautiful when the people that make them are paid well and work in a safe environment”.

(FTM Member, Creative Women)

While preventive measures are being taken to stop the spread of COVID which has already halted the global economic activity, people are looking for ways to support, revive and cultivate a sense of unity to kick start the disrupted economies. The fat cat along with the workers of respective sectors have taken a hit, as they begin to socially distance across the world, but the hierarchy of society with respective financial resources are mobilising to support them followed by the millions of families effectively and efficiently. However, even during this period of crisis, we mustn’t forget the unseen producers of the supply chain who are the helping hands of society and yet are the worst affected class when the crisis strikes.

The market was hastily shut down and is expected to take at least a couple of years to function at pre-COVID levels. As we know, trade, in layman’s vocabulary means “ purchasing or selling goods & services within communities as well as countries”. Though traders have suffered considerable losses during this period and continue to keep an eye for the slightest chance of revival, any future course of business should not depart from the constituting pillars of Fair Trade viz, trust and good faith. Transparency in fair trade plays a crucial role not because it implores the traders to adopt a market-friendly approach but because of its potential of attracting reciprocations from consumers who are well educated of their rights. In the 21st-century, consumer laws and awareness has developed rapidly making it challenging for traders to fool them, as they are aware of their respective rights. The transparency of trade is a governance which is to help producers across the globe to achieve sustainable and equitable trade relationships. There are numerous organisations which govern the policies of fair trade movements whereas the members add the payment of higher prices to exporters, as well as uplift the social and environmental standards. The main aim to govern certain commodities, or products that are typically exported from developing countries to developed but is also used in domestic markets (e.g. USA, England, and Bangladesh), most notably wine, sugar, fruit, flowers, and gold. It is grounded in three core beliefs; first, producers have the power to express unity with consumers. Secondly, the world trade practices that currently exist promote the unequal distribution of wealth between nations. Lastly, buying products from producers in developing countries at a fair price is a more efficient way of promoting sustainable development than traditional charity and aid.

However, there has been a fair share of impediments in the way of fair trade policies, such as “protectionism” & “dumping” (pricing policy). Every government or concerned trade bodies may have certain reservations towards opening their markers but cannot deal with dumping which creates an atmosphere of disadvantage for the domestic producers. Though there are commissions and strategies in place, the element of politics tends to jeopardise fair trade, for instance, several bodies of the European Union which have been constituted to draft uniform policies for fair trade within Europe, or similar commissions spearheaded by France, Italy, Netherlands etc. unfortunately though, these deliberations and initiatives have failed to either come up with a suitable policy or implement the same, in those few instances where there has been a breakthrough. This has left the concern about the role of “political strategy” in trade unanswered despite attempts which have rather led to the divided opinion on the nuances of fair trade. At times efficiency depends on the broader context such as the lack of government assistance or volatile prices in the global market. Though this might lead us to the conclusion that trade is seldom fair, it often neglects those classes which are most affected by the same such as farmers and others associated with the primary sectors of developing economies.

Post pandemic there may be a ray of hope for the beginners which might help them in getting substantive portions against their respective products from the markets. Several foundations in developed and developing countries are now preparing for the post-COVID world which is a good sign, considering the pre-COVID scenario of frequent trade wars. The key takeaways from the same have been while there have been deliberations to expand the CSR, these foundations have ensured a democratic setup which works for the betterment of those involved from the grassroots levels to the top and ensures a fair and diversified redevelopment of trade practices.

“ Fair Trade is all about improving lives but we don’t do they through charity- there are no handouts in the fair trade world”

Paul Rice