The philosophical principles underlying the concept of fair trade (FT) can be traced back to Aristotle (and his ideas of justice, equity and goodness) but the concept as it is known now first appeared in the United States, with the ‘Ten Thousand Villages’ (formerly Self Help Crafts) project in the late 1940s, and then with Oxfam, UK, in the late 1950s, when Oxford students introduced the sale of crafts made by Chinese refugees in Oxfam shops. In 1964, Oxfam created the first Fair Trade Organization but parallel initiatives were taking place in the Netherlands, notably with the message ‘by buying cane sugar you give people in poor countries a place in the sun of prosperity’.
Networks of engaged citizens have been crucial in the constitution of the Fair Trade movement, working as volunteers in Fair Trade shops in order not only to diffuse products but also ideas. The second UNCTAD conference (United Nations Conference on Trade and Development) in Delhi in 1968 was crucial in enabling developing countries to bring the debate to an international political forum with the motto ‘Trade not Aid’, adding equity to the international agenda.
Fair trade thereafter became associated with objectives of economic and social development: at a micro scale, aiming to provide a supplementary income to families, and at a global scale, to make international trade fairer and make mainstream business more aware of its social and (later) environmental responsibility. In the 1980s, the first Fair Trade ‘label’ was conceived by a Dutch church-based NGO, after which similar non-profit Fair Trade labelling organisations flourished. In 1997, some order was introduced with international standards and a certification process agreed by the Fairtrade Labeling Organisation (FLO). Labelling and certification has brought Fair Trade to mainstream business, as currently, over two-thirds of Fair Trade products are sold by mainstream catering and retailing. A common definition was agreed on in 2001 by the main Fair Trade networks, including Fairtrade Labelling Organisations International (FLO), International Federation for Alternative Trade (IFAT; now WFTO), and European Fair Trade Association (EFTA):
Fair Trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalised producers and workers – especially in the South. Fair Trade Organizations, backed by consumers, are engaged actively in supporting producers, awareness raising and in campaigning for changes in the rules and practice of conventional international trade.
Critics note that the Fair Trade movement was born of a logic of consumption, one that has turned Fair Trade into a market niche that risks being captured by the dominant actors of the food system (Renard, 2003). This process of institutionalisation is likely to lead to a lowering of the social and environmental requirements and ultimately to undermine efforts to address the structural obstacles faced by countries in the extractive periphery. Moreover, the range of goods that fits into this niche is narrow, excluding many essential bulk commodities travelling from South to North, such as agricultural and mineral exports (soybeans, oil, gas, copper and iron ore).
Renard, Marie-Christine (2003) Fair trade: quality, market and conventions, Journal of Rural Studies, vol. 19, pp. 87-96.
For further reading:
Goodman, Michael K. (2004) Reading fair trade: political ecological imaginary and the moral economy of fair trade, Political Geography, vol. 23, pp. 891-915.
Malo, Marie-Claire et al. (2009) Le processus d‘institutionnalisation du commerce équitable, CRISES. Collection Études théoriques, n° ET0905, 16p.
Kocken, M. (2006) Sixty Years of Fair Trade. A brief history of the Fair Trade movement, EFTA, 6p. (last update: November 2006), http://european-fair-trade-association.org/efta/Doc/History.pdf
Fair Trade Advocacy Office [http://www.fairtrade-advocacy.org/]
European Fair Trade Association [http://www.european-fair-trade-association.org]
Osfam International. Trade campaign [http://www.maketradefair.com]
This glossary entry is based on a contribution by Emilie Mutombo
EJOLT glossary editors: Hali Healy, Sylvia Lorek and Beatriz Rodríguez-Labajos