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Gains Of Fair-Trade: Groups Involved In Fair-Trade System Essay Example

Gains Of Fair-Trade: Groups Involved In Fair-Trade System

They must pay a certain price to the producers to cater for the cost of sustainable living and production; this is known as a living wage. They must pay in advance especially when the producer asks for it. Pay a certain premium where farmers can invest economic and social developmental projects. Allow the signing of contracts that gives the producer a guarantee that the product will be bought; it allows for long-term planning and sustains the practices of production. Fair-trade certifiers are organizations that certify importers and producers as fair-trade by following fair-trade requirements and guidelines. A fair-trade labeling organization is an entity that certifies producers from all over the globe as fair-trade. They also ensure that producer’s fair-trade standards are followed (Worldcentric.org 2014).Challenges Facing Fair-TradeGains of fair-trade are unequally distributed with the major flaws emanating from the characteristics of the certification. Certification system creates a twofold bias against the world’s poorest developing nations. First, the cost of certification is found to be more expensive for the disadvantaged countries, all the other things are relatively equal. Sliding scale structure creates an avenue where certification becomes less costly for the large consumer organizations than their smaller counterparts. Also, costs of compliance with fair-trade standards that include alterations in the administrative and agricultural practices that lead to an overall rise in working hours are higher for smaller organizations. It is due to the lower economies of scale and lower productivity (Sylla 2014).FindingsFair-trade certified articles are mainly based on products exported by Latin America nations. Coffee has a 36 percent certification demand, tea 9.3 percent demand; bananas have an 8 percent demand and vegetables stand at 9.1 percent. These products were the top certified products of the year 2009. One out of two fair-trade certified products is cocoa, coffee or bananas.

preview essay on Gains Of Fair-Trade: Groups Involved In Fair-Trade System
  • Pages: 4 (1000 words)
  • Document Type: Essay
  • Subject: Macro & Microeconomics
  • Level: Masters
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