Sunday, October 28, 2007

Fair Trade Tirades

Yesterday I was in a café, which (among other coffees) sold fair trade coffee from Indonesia. The problem was, it /only/ sold fair trade coffee.

I never buy fair trade products. Why?

Fair trade implies that other types of trade are /not/ fair. In fact, trade is a wholly voluntary activity, by definition it only takes place when both buyer and seller are satisfied with the deal.

Fair trade gives consumers and producers wrong minded incentives.

Western consumers believe that buying non-fair trade products from developing countries is detrimental to those countries - which is clearly not the case.

Producers are lured into participating in markets (like the volatile coffee market) with the /hope/ of better long term prices, rather than diversifying into other more stable markets. The costs of employment increases which increases unemployment in societies where underemployment is endemic.

Compared to buying fair trade, donating to charity is a less destructive way of helping people out, it may take a bit more of an effort, but at the end of the day your Euro will be more effective.

6 comments:

Denica said...

fair trade coffee costs more here. is it there?


"it only takes place when both buyer and seller are satisfied with the deal."

which buyer? and which seller?

just curious, how do you choose the right charity org that doesnt transfer ur donation into their pockets?

spew-it-all said...

Isn't it fair trade coffee started as a campaign following the significant drop of coffee price? I remember reading article that Starbucks buys cheaps coffee and sells it with higher price. Coffee farmers in Brazil, if i am not mistaken, threw their coffee into the sea when the prices dropped.

I fail to understand that buying fair trade coffee is not helpful at all.

What actually happened to coffee farmers after decision was taken to sort this problem or fair-trade was carried out?

johnorford said...

"fair trade coffee costs more here. is it there?"

Yup, same here :)

"which buyer? and which seller?"

all buyers and sellers.

"how do you choose the right charity org that doesnt transfer ur donation into their pockets?"

u do a lot of research? u can never be sure, but what in life can u be sure about anyways?

johnorford said...

"I fail to understand that buying fair trade coffee is not helpful at all."

Well, we both agree that coffee growers are in a dangerous market, right?

Then paying higher than market prices does two things:

1) Decrease demand - ppl (on av) will buy less

2) Increase supply. growers will take a chance, and grow more. more ppl will b attracted to coffee growing

So, instead of getting ppl out of the dangerous trap which is the coffee mkt, they are pulled in.

I donate money for kid's education, so they can have some chance to escape coffee etc...

spew-it-all said...

I don't think the case is not as simple as that i am afraid. What happens to coffee, i presume, can be looked at merely through supply-demand framework.

These days, fair trade and organic products are sort of 'genre' which appeal to some people. It becomes fashionable lifestyle as they have health, social and environmental concerns.

I agree that helping their educations is crucial but i am afraid that sustainability of these farmers would be at peril if they have to be separated from their subsistence (coffee growers). It's not making thing better if they are working as labour in construction or mining sites, is it?

johnorford said...

"It's not making thing better if they are working as labour in construction or mining sites, is it?"

Well I don't know - but I am willing to bet that poor labourers would have a better idea than me about what's the best industry for them to work in.

Paying more for coffee lets clueless wealthy westerners decide for them - /not/ the best of ideas.