Fair Trade Is Growing But Africans Lag Behind

Paris – Despite its minuscule share of world trade, fair trade is a booming business, importing certified foodstuffs and products from all over the world to Northern supermarkets. But there is increasing concern that this growth is yet to benefit poor countries in Africa.

The movement to ensure decent prices and working conditions for producers in the developing world represents less than one percent of global commercial exchanges.

But, according to the Fairtrade Labelling Organisations, one of its main promoters, “the sales of fair trade certified products have been growing with an average of almost 40 percent per year in the last five years”.

Between 2007 and 2008 worldwide sales grew with 22 percent and by 2009 the tiny sector’s sales notched 3.6 billion euro. That same year, despite the global financial and economic crisis, fair trade sales in France alone increased by 10 percent.

But fair trade’s expansion in terms of sourcing from poor countries in Africa has been much slower.

“It is obvious that fair trade does not focus enough on least developed countries,” says Christophe Eberhart, of Ethiquable, a cooperative that imports fair trade foodstuffs to France from African least developed countries (LDCs).

One of Ethiquable’s initiatives supports vanilla farmers in Comoros, an island state off the eastern coast of Africa. The cooperative buys their flavouring vanilla pods at 100 euro per kilo, instead of the market prices of 25 euro.

Fair trade statistics do not disaggregate production figures by region, or by countries’ income category, which makes it hard to see the extent to which fair trade benefits LDCs. Moreover, “it is much easier to implement fair trade in countries such as Costa Rica, Thailand or India than in many sub-Saharan countries”, Eberhart contends.

Fair trade is increasingly popular with European consumers. In France, the Platform for Fair Trade (“Plate-Forme pour le Commerce Équitable” in French) polled consumers and found that 95 percent of them have heard of fair trade. But most fair trade success stories hailing from the South are from South America and Asia, rather than Africa.

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The Fairtrade Labelling Organisations’ 2009 report lists a growing number of consumer prizes awarded to fair trade products. Among an estimated 6,000 products, Bolivian vodka, Ecuadorian spicy banana chips and other niche delicacies were endorsed. But no African goods made the list.

“Fair trade importers such as ourselves work mainly with associations or cooperatives of producers,” Eberhart explains. “And these structures, which facilitate technical and financial assistance to farmers, are historically much more common in Latin America.”

“In Peru, for instance, the farmers’ cooperative running our jam manufacturing plant got help from local specialists to monitor quality,” he points out. “But in Mali, where we set up a unit to transform fonio (a grain variety), we have struggled to find local expertise to assist us with food safety processes.”

There are other structural challenges to trading with African LDCs. In order for fair trade to benefit a maximum number of people, decent prices and livelihood-sustaining wages have to be paid not only to producers but to workers throughout the entire production chain, including those working in packaging, transporting and shipping.

“Our approach to fair trade aims at working directly with producers’ organisations, and ensuring they export their own goods,” says Eberhart. “But, in Africa, we have observed that many producers rely on private exporters.”

Farmers thus lose the profits made on exports, which are generally much higher than those made merely on production.

“This does not help producers achieve greater capacity or autonomy,” Eberhart laments. “In Madagascar, for instance, very few producers and cooperatives export their products directly. Most of them rely on a few, very large exporters who hold all the bargaining power,” he adds.

As in all sectors of trade, size matters. Even producers benefiting from higher fair trade prices and expertise have to negotiate shipping fees. Larger producer organisations have more leverage.

“Ethiopian cooperatives producing coffee, for instance, tend to do well as they have larger volumes and better expertise,” says Eberhart.

The Fairtrade Labelling Organisations have developed a standard that applies not only to producers but also to traders. Its certification body, FLO-CERT, audits and certifies producers and traders before sales start. But limited resources and market structures make it almost impossible to check the entire chain from African fields to supermarket shelves.

Still, networks are expanding rapidly. The World Fair Trade Organisation now claims 600 member organisations in 70 countries. It is estimated that 1.5 million workers and producers participate in fair trade in Asia, Latin America and Africa.

“Our aim is for fair trade to be a real lever for development,” says Eberhart. “For that to happen, we need to help small farmers develop their own local capacity for the processing of their products and not to just facilitate sales.”

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