Fair Trade

3180 WordsDec 13, 201113 Pages
Fair Trade: Consumerism for Global Justice Introduction The Fair Trade movement is rapidly becoming an emerging and dynamic strength to respond to the negative influence of globalization, or rather, to the contemporary international trade injustice. While on the other hand, there is criticism on fair trade, claiming that fair trade is not fair and it goes against free market theory. This term paper aims at introducing the development of fair trade, justifying its economical and ethical significance on the international trade and production chain, and also reflecting on its limitations from different respective. The term paper is structured starting from conceptual framework, which focuses on defining the term of “fair trade”,…show more content…
One set of standards applies to small-scale producers, who don’t depend on hired workers all the time, but run their farm mainly on their own and their family’s labour. The other set applies to hired labors, whose employers pay decent wages, guarantee the right to join trade unions, ensure health and safety standards and provide adequate housing where relevant. The Standards Unit (SU) within FLO is responsible for developing and revising fair trade standards. Fair trade standards refer to: (a) generic standards, (b) product standards, (c) fair trade minimum prices (FTMP) and fair trade premiums (FTP). Producers and traders must meet applicable standards for their products to be certified as fair trade. Fair trade prices According to fair trade standards, most products have a fair trade price, which is the minimum that should be paid to the producers for their goods. This fair trade minimum price (FTMP) is intended to cover the average producers’ costs of sustainable production (COSP) per product. If global or regional minimum prices are determined, otherwise national prices are set. Producers or workers (in the case of hired labour situations) of fair trade products also receive a fair trade premiums(FTP) in addition to the minimum price. The determination of a minimum price may involve the determination of the related premium (Andreas Kratz, 2010). Impact of fair trade

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