There are a number of benefits of fair trade for farmers and manufacturers in developing nations.
We hope, given time and consumer pressure, these practices will spread across more industries and more trades so that a greater proportion of workers in the developing world can enjoy the benefits of fair trade.
Stable and Fair Prices
Stable prices are maintained throughout the year, even when the market demand changes adversely. This is a good deal for those farmers who depend on crops as the only source of income.
In a normal market, farmers will run at a loss when the demand is low and production is high. Fair trade practices benefit the farmers in this regard.
Stable prices are important for manufacturers of other products as well as foodstuffs. For many products there is a strong seasonal demand, with various factors such as the weather and Christmas causing fluctuations in the demand. Many Fair Trade companies pledge to maintain a steady level of purchasing throughout the year to enable the farms and factories to maintain steady revenue streams and stable employment.
Improved Quality of Life
The lifestyles of the workers are improved to some extent by employers following Fair Trade practices. Many fair trade projects improve living conditions in terms of health, education and working conditions. Healthcare services are enhanced and modern facilities put in place.
This ensures that the population is productive for longer to meet the demand of products in the market. High productivity means higher profits and a more sustainable future for all.
Investment in Education
Investing in education is facilitated where modern learning facilitates are offered free of charge to the regions where the farmers come from. Innovation is thus enhanced in the agricultural sector and more higher levels of production are achievable with this increase in knowledge.
Research is extensively carried out and strains of crops which are resistant to insects are produced. High yielding crops are also developed which are suited for specific geographical regions. All these are fully supported by fair trade.
Business partnerships are created between local producers and international markets. Committees are set up to help in exploring international markets where products may sell in large quantities and at higher prices. This helps to maintain the income of the farmers at all times.
Farm inputs are often offered at a subsidized price and the best combinations are made available for the farmers to use. Interacting with worldwide investors is a key thing for the success of any business. Fair trade brings together a large number of farmers who interacts with the available investors and they end up having better bargaining power than individual farmers would on their own.
In many cases, Fair Trade companies in the UK and other nations will provide interest free loans to enable businesses in developing nations to bring their businesses up to the required standards to enable Fair Trade products to be made. These loans can be invaluable in improving working conditions, providing agreed wage levels and purchasing equipment
Empowerment of Workers
Empowerment is an evident benefit to the producers within the Fair Trade chain. This is because transparency in a major aim in all activities involved in marketing of fair trade products. Workers are encouraged to work more because they have trust that their money is not embezzled or stolen.
Those in charge of the management are free to interact with the farmers on a personal level where they can provide advice and receive feedback.
In this way the working conditions are monitored and developed and in line with the modern requirements.
In the case of farming, advice is given to help farmers to choose crops and products with more favorable characteristics, which creates a product of higher market value. The training opportunities which are offered to the farmers can also help them to capture a wider market share due to production of crops which are in high demand.
Environmental Benefits of Fair Trade
Preservation of the environment is one of the major benefits of Fair Trade.
- Farmers are encouraged to use chemicals which are less harmful to the surrounding environment.
- Use of inorganic substances which do not leave behind toxic residuals is encouraged and suitable mechanisms are put in place.
- Campaigns are carried out to educate the public and more specifically the farmers on the benefits of this inorganic farming which promises a healthy nation free from effects of these toxins.
Investment in Infrastructure
Modern machines and other equipment used in processing and manufacturing are often donated or sold at a reduced price to the factories. What may be outdated technology in Europe may be an improvement on the processes available to smaller producers in developing nations.
This can help to increase the efficiency of fair trade manufacturers and better enable them to compete with other forms of trade.
Benefits to the Consumer
For the most part, when we discuss the benefits of fair trade we concentrate solely on the benefits to the farmers and producers in developing nations. But it’s also fair to say that the end consumers of the products also get benefits from purchasing Fair Trade products.
If you are free to live your life knowing that, as much as possible, you go out of your way to increase the amount of good in the world, you will surely lead a happier and more contented life.
All of these benefits of Fair Trade come about through the willingness of companies in developed nations to push for fair trade practices within the producer nations, and through the pressure of consumers to