What is Fair Trade

Fair trade is an innovative concept that connects producers and consumers in more equitable, more meaningful, and more sustainable ways. It happens through the development of consumer interest and the creation and cultivation of socially responsible importers. It is both moral and market driven.

The Fair Trade Federation (FTF), the largest association of fair trade organizations, has the following seven principles upon which fair trade is based.

1. Fair Wages

Paying fair wages does not necessarily mean that products cost the consumer more. Since Fair Trade Organizations bypass exploitative middlemen and work directly with producers, they are able to cut costs and return a greater percentage of the retail price to the producers.

2. Cooperative Workplaces

Fair Trade Organizations work primarily with small businesses and worker owned, democratically run cooperatives and associations, bringing significant benefits to workers and their communities.

3. Consumer Education

Fair Trade Organizations educate consumers about the importance of purchasing fairly traded products, which support living wages and healthy working conditions.

4. Environmental Sustainability

Fair Trade Organizations encourage producers to engage in environmentally friendly practices, which manage and use local resources in a sustainable fashion.

5. Financial and Technical Support

Small-scale farmers and artisans in the developing world lack access to affordable financing, impeding their profitability. FTF members that buy products directly from producers often provide financial assistance either through direct loans, prepayment or by linking producers with sources of financing.

6. Respect for Cultural Identity

Fair Trade Organizations encourage the production and development of products based on producers' cultural traditions adapted for Western markets.

7. Public Accountability

FTF members' finances, management policies, and business practices are open to the public and monitoring by the Fair Trade Federation. The FTF provides an independently monitored guarantee that fair trade conditions are really being met and are not just marketing hype.

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