Page 4 - Economy_Fair Trade International Trade

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Introduction to the topic

Fair trade is sustainable trade for sustainable development in different communities by pursuing the
development of people and in the fight in ending the poverty. Fair trade is the collaboration between
non-profit importers, small producers from developing countries and merchant sin Northern countries. Fair
trade promotes justice, equity and sustainable development and position them as the core practices of the
structure and commercial activities. Fair tare is based on transparency, respect and cooperation with the
aim to promote equity in international trade. In addition, Fair trade has direct and indirect effect on the
achievement of the SDGs 2030, contributing for the achievement of those goals. Fairtrade has a particular
role with trade in export supply chains and Fairtrade contributes to the achievement of key SDG goal areas,
including Goals 2, 5, 8, 12, 13, 16 and 17.

The expansion of international trade and effects of globalization contributed for commercial practices and
economic growth of many countries. Nevertheless, the positive effects and benefits have not been shared
equally, poverty has not been reduced and many regions and population are living in critic situation of
extreme poverty. Inequality has grown, according the Global Wealth Report (Credit Suisse, 2019), nearly 1%
of adults are millionaires who collectively own 44% of global wealth in 2019, and even high percentage of
population has barely escaped from poverty, with half of the population subsisting on less than $5.50 a day
and extreme poverty is increasing in Sub-Saharan Africa (OXFAM, 2019).

In order to reduce poverty and inequality, fair trade is the mechanism through which disadvantaged
workers and farmers connect with consumers and fair trade is promoted, which contributes in the
combating of poverty. Social, economic and environmental standards for companies, farmers and workers
are set through the protection of their rights and the environment, and payment of a minimum price. For
achieving the objectives and promote fair trade, the 10 Principles of Fair Trade have been established.
Commitment to Non-Discrimination, Gender Equity and Freedom of Association, and Ensuring no Child
Labor and Forced Labor, are two of the principles.

Furthermore, in order to assure the economic trade with ethical standpoint, a Fairtrade certification
initiative is internationally recognized code for sustainability standards for those products which encompass
the requirement for sustainable and fair trade product (FairTrade Ibérica, 2020).

At European Union level, the World Fair Trade Organization Europe (WFRO-Europe, 2020) is part of the
WFTO, which’s goal is to allow and enable producers to improve their communities and livelihoods through
fair trade. The WFTO-Europe is driven by the following strategic objectives:

• Support the growth and strengthen the WFTO Global.
• Support and protect the values of Fair Trade and the commitment to it.
• Representative for Fair Trade in Europe.
• Support Fair Trade policies. Support the legality of the office.