The New Conscious Consumer: Expanding Economic Justice Through Fair Trade

The New Conscious Consumer: Expanding Economic Justice Through Fair Trade

Credit: SERRV Credit: Simon Rawles Dear Friend, We hope this booklet provides you with a further introduction to the people, products and social justice impact of Fair Trade. As this commerce system and movement continues to grow and become more complex, individuals need accessible resources that summarize the opportunities, challenges and variety within the Fair Trade system. We hope William Gabriel, Windward Islands this booklet serves as a primer from which you can go to books, websites, films and meetings to learn more about Fair Trade. As a more educated citizen, you will be a more conscious consumer, thereby improving life for yourself and vulnerable people around the world. Millions of farmers and artisans, and their families and neighbors, already gain increased opportunities through Fair Trade. As consumer interest in Fair Trade grows, even more producers will access education; obtain food, housing and medical care; build capacity in business and organizational development; and earn respect and dignity. With those goals at heart, this publication will help you......understand how Fair Trade relationships in over 60 less industrialized countries enhance the quality of life for vulnerable producers. interact with a global community taking action to ease inequities wrought by traditional trade structures....navigate the complicated world of organizations, labels and definitions of Fair Trade. We hope you ll continue supporting our educational efforts by participating in FTRN programs, making a tax -deductible contribution, or sharing this booklet with friends, colleagues, and members of your faith community. Together we can improve more lives through Fair Trade! Jeff Goldman Executive Director FTRN Thanks Booklet Sponsors: Jolica Ganesh Himal Trading Ten Thousand Villages FTRN gathers, develops, and disseminates educational resources to people and organizations interested in the movement to build a more just and sustainable world through Fair Trade. www.ftrn.org All Rights Reserved: Copyright 2010 Women Artisans, Rwanda

Credit: Global Exchange Table of Contents 1 Why Change Traditional Trade?... 2-4 What is the Goal of Fair Trade?... 4 What is Fair Trade?... 5-9 A Useful Definition of Fair Trade... 5 Identifying Fair Trade... 5-9 How does Fair Trade Differ from Free Trade?... 6 Fair Trade in Action... 10-18 Producer Stories... 10-15 Fair Trade by Some Numbers... 15-18 Brief History of Fair Trade... 19-25 Fair Trade Timeline... 20 Major Names in Fair Trade... 21-25 Challenges Facing Fair Trade... 26-29 How to Get More Involved in Fair Trade... 30-32 Shop Fair Trade... 30 Learn More... 30-31 Spread the Word... 31 Work or Volunteer... 32 Join an Action Campaign... 32 Farmer and consumer pick coffee, Nicaragua FTOs FTF FLO FTRN WFTO TF WFTD Frequent Acronyms To edit the companion Power Point presentation to this booklet, download and open the file from www.ftrn.org/learn Up/ and enter the code: CCreaderFTRN Cover photo of Master Weavers courtesy of Indego Africa Fair Trade Organizations Fair Trade Federation Fairtrade Labeling Organizations Fair Trade Resource Network World Fair Trade Organization Transfair World Fair Trade Day Cover photo of store courtesy of Handmade Expressions & Whole Earth Provision Co. Austin, TX.

2 Credit: Indego Africa Why Change We can do much better to improve the quality of life, and justice, open to huge numbers of people around the world. Today, more than 1 billion people live on less than one dollar a day and lack access to clean water, health care, education and other basic social services (U.N. Development Group 2008). The gap between the rich and the poor is widening, with the world s richest 20% consuming over 75% of the world s resources while the world s poorest 20% consume only 1.5% (World Bank 2008). Historically, societies that have thrived from commerce have exploited vulnerable people. While some developing regions, particularly in The retail price of roasted coffee dropped only 15% from 1999 to 2003, while prices paid to farmers fell by about 50% TransFair USA Weaver, Rwanda Asia, have experienced robust economic growth, widespread poverty has languished in much of Asia, Latin America and sub-saharan Africa, w h e r e AI D S, v io l e n ce, corrupt governments and lack of infrastructure exacerbate the misery. In Latin America onethird of the population lives below a subsistence level. While global trade has improved the conditions for some marginalized people, many critics suggest conventional commerce gives too much power to multinational corporations and rich countries, and too little power to less industrialized countries and producers working there. Conventional trade often minimizes opportunities for vulnerable producers and sometimes degrades the environment.

Credit: J. DeCarlo 3 Traditional Trade? Powerful governments frequently employ subsidies, tariffs, other trade tools, as well as lax labor and environmental standards to enable politically influential groups to focus on short-term profits, evade the full costs of commerce, and separate themselves from the plight of marginalized people. A wage of $1 [per day], common After recent decades of conventional in factories producing for U.S. trade, farm incomes worldwide have corporations, provides less declined dramatically while consumer than 25% of the minimum prices have risen and agribusinesses needs of a family of five. worldwide have seen record profits (Public Citizen). Conventional trade -National Labor Committee often lowers labor & environmental standards below a subsistence and sustainable level. With the proliferation of inexpensive products around the globe, conscious consumers have called into question the costs of their over-consumptive lifestyles. People are increasing their awareness of business practices, labor conditions, environmental issues, and cultural changes that increase the vulnerability of low-income people. Increasingly, consumers in developed nations are applying their buying power to challenge the current system and demand supply-chain accountability. Consumers are seeking alternatives that offer secure and rewarding lives for less fortunate people. Kids use water pump provided by Fair Trade, Ghana

4 Credit: Jeff Goldman Credit: Stephanie Sheerin Fair Trade also empowers communities and allows them opportunities to reinvest their Fair Trade profit for better education, nutritional programming, increased health services, improved roads and wells, and more. (Fair Trade) means that Haitians and others around the world can have a better life, have a better vision of themselves, can stand on their own two feet. Trade may be the most powerful, sustainable tool for boosting standards of living in the developing world. But for trade to lift up the world s poorest, it must be designed to include those people traditionally bypassed by the benefits of commerce. Fair Traders work with disadvantaged artisans and farmers to build their businesses and market their wares to consumers. Whereas conventional trade often perpetuates poverty, Fair Tr ade strives to more quickly uplift people from poverty. What is the goal of Fair Trade? While trade policy reform is critical, Fair Trade offers a business model that encourages change in global commerce and empowers producers. The system seeks to give marginalized people access to the market and increased independence. Based on principles of economic and social justice, Fair Trade shifts more power into the hands of the producers and conscious consumers. Fair Trade focuses on expanding opportunities in the developing world where most of the world s poorest live and work. Weavers gain healthy and safe workshop conditions through Fair Trade in Cambodia Gisele Fleurant, director, Committee for Haitian Artisans Advocates visit cacao farmer, Nagua, Dominican Republic

Credit: Global Exchange 5 What is Fair Trade? Swaziland artisan at work on the loom Fair Trade is a lot of things: a social justice movement, an alternative business model, a system of global commerce, a tool for international development, a faith-based activity. It means different things to different people. There is no single, regulatory, authoritative body. So, individuals need to explore various models and concepts. Fair Trade s many definitions do always center Every business transaction is a challenge to see that both parties come out fairly. Adam Smith, 1759 around the exchange of goods based on principles of economic and social justice. A Useful Definition of Fair Trade In 1998, four key international organizations, based in Europe, created a widely accepted definition of Fair Trade. Fairtrade Labeling Organization (FLO), International Fair Trade Association (now World Fair Trade Organization, WFTO), the Network of European Worldshops (NEWS!) and the European Fair Trade Association (EFTA) created a workgroup known as FINE, an acronym of their names. FINE defined Fair Trade as: 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, disadvantaged producers and workers especially in the South. (FINE, 1998) Identifying Fair Trade With many different definitions, and no single, authoritative body, Fair Trade takes many forms in the U.S. and around the world. Different organizations and individuals use different criteria for determining what is, and isn t, Fair Trade. The two most widely recognized ways of identifying Fair Trade are organizational recognition and product certification. With organizational recognition, a trading organization is approved as Fair Trade. For these

6 traders, almost every item they sell is a Fair Trade product. Not only are producers treated fairly through minimum prices and social premiums, but other practices of the trading relationship are conducted in concert with Fair Trade values and goals. For example, SERRV builds the capacity of producers to respond to market trends, to learn best practices, and awards grants to buy tools and equipment. Credit: Photo thanks to www.charlessteinbergphotography.com Beads to Bricks at BeadforLife How does Fair Trade Differ from Free Trade? Many people are familiar with the term free trade, which has played a major role in countries trade policies in the past few decades. While free trade policies need reform, Fair Trade adds a complementary business model to such reform. The table below summarizes key differences: Main goal: Focuses on: Primarily benefits: Critics say: Major actions: Producer compensation determined by: Supply chain: Key advocate organizations: Free Trade is NOT Fair Trade Free Trade To increase nations economic growth Trade policies between countries Multinational corporations, powerful business interests Punishing to marginalized people & the environment, sacrifices long-term Countries lower tariffs, quotas, labor and environmental standards Market and government policies Includes many parties between producer and consumer World Trade Organization, World Bank, International Monetary Fund Fair Trade To empower marginalized people and improve the quality of their lives Commerce among individuals and businesses Vulnerable farmers, artisans and workers in less industrialized countries Interferes with free market, inefficient, too small scale for impact Businesses offer producers favorable financing, long-term relationships, minimum prices and higher labor and environmental standards Living wage and community improvement costs Includes fewer parties, more direct trade Fairtrade Labeling Organization, World Fair Trade Organization

Credit: Dr. Bronner s Magic Soaps With product certification, an item is Fair Trade no matter who trades it. Certification centers around a minimum price which is paid to the producer for the item, and a social premium which is paid to the producing community or organization for development. The wider practices of the trading organization are not considered, even if those practices largely conflict with the values and goals of Fair Trade. For example, Wal-Mart may sell a little certified Fair Trade coffee, along with a lot of conventional coffee and thousands of other conventional goods. 7 Under organizational recognition, vendors must show evidence Farmer carries bag of mint, Sri Lanka to consumers and traders that they are approved as fully committed Fair Trade organizations by a third-party approval body. Individual products sold by Fair Trade organizations may, or may not, have a Fair Trade mark or label. Many Fair Trade advocates call these organizations fully committed, mission-driven, or 100% Fair Trade. There are predominantly two third-party associations that recognize Fair Trade organizations in North America: the Fair Trade Federation (FTF) in North America and the international World Fair Trade Organization (WFTO). They have similar criteria. The criteria for FTF are below: 1 2 3 Create Opportunities for Economically & Socially Marginalized Producers: Fair Trade is a strategy for poverty alleviation & sustainable development. Develop Transparent & Accountable Relationships: Fair Trade involves relationships that are open, fair, consistent & respectful. Build Capacity: Fair Trade is a means to develop producers' independence. 4 Promote Fair Trade: Fair Trade encourages an understanding by all participants of their role in world trade.

Credit: Kaare Viemose Credit: Mike DuBose, UMNS & Global Goods Partners 8 5 6 7 8 9 Pay Promptly & Fairly: Fair Trade empowers producers to set prices within the framework of the true costs of labor time, materials, sustainable growth & related factors. Support Safe & Empowering Working Conditions: Fair Trade means a safe & healthy working environment free of forced labor. Ensure the Rights of Children: Fair Trade means that all children have the right to security, education & play. Cultivate Environmental Stewardship: Fair Trade seeks to offer current generations the ability to meet their needs without compromising the ability of future generations to meet their own needs. Respect Cultural Identity: Fair Trade celebrates the cultural diversity of communities, while seeking to create positive & equitable change. Other bodies, with small programs involved in recognizing Fair Trade Organizations may have different criteria than the major two associations. Anyone interested is encouraged to do further research. Under product certification, every individual Fair Trade product must be labeled with a Fair Trade mark. At present there are a few such marks in the U.S. Organizations selling certified goods vary greatly in their involvement in Fair Trade, and may have, for example, less than 1%, 5%, 20%, 50% or 90% of their annual purchases be Fair Trade products. Many Fair Master trainer, Pakistan Trade advocates call such organizations partially committed. Criteria for certification vary by product type. Standards for fairly traded tea are different than those for coffee, because tea is predominantly grown on plantations rather than on small farms. Olive oil, jewelry, clothing and soccer balls also are produced under widely different circumstances, and result in significantly different criteria for Fair Trade. Three women pick Fair Trade tea leaves There is only one major Fair Trade product certification system globally-- Fairtrade Labeling Organizations (FLO). FLO manages a labeling initiative in each consumer country to administer the Fair Trade label, or mark, to all Fair Trade Certified

Credit: Simon Rawls 9 Mamouna Keita cotton picking in Mali All agricultural items Fair Trade Certified by FLO are produced according to these Fair Trade principles: Fair prices: Democratically organized farmer groups receive a guaranteed minimum floor price and an additional premium for certified organic products. Farmer organizations are also eligible for pre-harvest credit. Fair labor conditions: Workers on Fair Trade farms enjoy freedom of association, safe working conditions, and living wages. Forced child labor is strictly prohibited. products sold in that country. In the U.S., TransFair USA serves as FLO s labeling initiative, and in Canada, TransFair Canada. Most Fair Trade Certified products are agricultural products, such as coffee, tea and herbs, cocoa & chocolate, wine, olive oil, fresh fruit, flowers, sugar, rice, and vanilla. Direct trade: With Fair Trade, importers purchase from Fair Trade producer groups as directly as possible, eliminating unnecessary middlemen and empowering farmers to develop the business capacity necessary to compete in the global marketplace. Democratic and transparent organizations: Fair Trade farmers and farm workers decide democratically how to invest Fair Trade revenues. Community development: Fair Trade farmers and farm workers invest Fair Trade premiums in social and business development projects like scholarship programs, quality improvement trainings, and organic certification. Environmental sustainability: Harmful agrochemicals and Genetically Modified Organisms are strictly prohibited in favor of environmentally sustainable farming methods that protect farmers' health and preserve valuable ecosystems for future generations. There are also some organizations certifying a small amount of Fair Trade products. For example, the Institute for Market Ecology s Fair for Life program certifies soaps, teas, produce and other products. Fair Trade criteria for these certifications may differ from those of FLO. Anyone interested is encouraged to do further research.

10 Credit: Global Exchange Fair Trade in Action The complex world of Fair Trade can be clarified further with some illustrative producer stories and business numbers. Cocoa Cooperative with 9000 Members in the Dominican Republic Builds Capacity for Sustainable Business Credit: Global Exchange Many of the Dominican Republic s small farmers still struggle to survive. Founded in 1988 and a participant in the Fair Trade system since 1995, the Conacado cooperative aims to generate work and income for disadvantaged groups. Conacado has about 9,000 members that receive a majority of their income from cacao. Fair Trade provides added support for farming methods that are safe for the environment and public health. Fair Trade also ensures a higher minimum price, long-term contracts and access to credit. Most farme rs do not have savings and face extreme difficulty securing loans, while the government has very limited means for aiding these farmers. Producer Stories Cacao farmer, Cacaonica, Nicaragua With the higher price from Fair Trade, sales have provided the cooperative with enough income to meet basic expenses and invest in the future. In the wake of the massive destruction of Hurricane George in 1998, the importance of Fair Trade revenues was clear, as the communities were able to rebuild. Fair Trade has helped the cooperative to organize workshops to teach farmers how to improve fermentation techniques, expand sustainable growing methods, increase productivity, and participate more actively in the cooperative.

Credit: Handmade Expressions Credit: TransFair USA Woman picking Fair Trade tea leaves Fair Trade Certified Tea in India Shows Substantial Benefits Over 15 Years Credit: TransFair USAUSA The Chamraj tea estate in Tamil Nadu, south India, had some of its tea certified in 1994 as some of the first Fair Trade Certified tea in the world. In 2009, the business produced 40,000 kg of green leaf and 10,000 kg of black leaf each day, nearly 8% of which were Fair Trade. Over 15 years the Fair Trade premium has bought a new school block with computers and laboratories, several school buses and a doubling of children in schools. Workers on tea estates are automatically housed, but when they retire they often become homeless. The premium has paid for an enhanced pension that enables former workers to build a new home. It has also paid for a doctor at the local hospital and for modern medical equipment, which is used by people from miles around. The conventional tea growers in the surrounding area are reported to be much worse off. Market Access Brings Livelihood for Artisans in India Credit: Fair Trade Federation 11 Ramlal Khatri was a very talented artisan from India, who followed environmentally friendly processes and only used natural dyes. But like many artisans, his lack of knowledge and access to a market made earning an income a struggle. Meanwhile, Manish Gupta lived a very successful life in Austin, Texas, but felt unfulfilled. Following a trip to his homeland to see how he could help artisans, Manish decided to start a Fair Trade organization now known as Handmade Expressions. Manish partnered with several NGOs and artisan cooperatives to help them create high quality, hand-crafted goods. For Ramlal and his community, Handmade Expressions adapted their age-old techniques to develop modern, functional products. The company researched information on what products were selling in international Artisan weaving on wheel, India markets, relayed this information back to the artisans, and designed a re-usable shopping bag and a laptop bag. Today, due to Fair Trade and the success of these artisans, the whole community now has sustainable income and a fair portion of the proceeds goes back to the artisan s communities to develop the education and health systems, among other social projects.

12 Marginalized Workers Gain Dignity at Winery in South Africa Credit: TransFair USA Marie is the woman in charge at Stellar Winery, but life hasn t always been so sweet for her. Growing up in apartheid South Africa, Marie had to drop out of high school to help her family make ends meet. When her mother passed away unexpectedly, she was forced to take care of her younger siblings as well as four other orphans she raised as her own. To support these children she took a job as a domestic servant and eventually made her way over to the grape growing industry. In the legacy of apartheid, many vineyard workers were paid less than $2 a day, a wage with which they could not afford to support themselves or their families. Some farms even paid their workers in wine, with disastrous effects on the livelihoods and health of the community. At Stellar Organics, north of Cape Town, people like Marie are demonstrating a new way to do business. Marie is the Farm Manager at an award-winning, organic vineyard that produces Fair Trade Certified wine. Like the other workers here, she has a stable income, electricity and sanitary systems. Not only does Stellar comply with Fair Trade standards for workers wages and rights, but the organization also follows special programs put in place to combat post -apartheid inequality in South Africa. These programs mandate that workers own shares in the company, providing land and business ownership opportunities to disadvantaged farm workers. Marie now owns a part of the successful company that she manages. Stellar has invested a portion of their proceeds into a worker-owned grape farm that supports a local After Stellar Organics became a Fair Trade certified farm, the possibilities were there to improve our lifestyles and securities. The living conditions of everybody on the farm changed. Our houses now have electricity, and we have the necessary sanitary systems. In the past, before linking with Fair Trade, all the money went to the owner of the farm, but now the workers also share in the profit. - Marie Malan, Stellar Organics, South Africa elementary school and computer center for workers and their children. By investing in her community, Marie can help the outcome of children like these in ways she didn t have growing up. Marie was even named the Sanlam National Farm Worker of the Year. The Sanlam National Farm Worker Award is very prestigious and seeks to recognize farm workers for their specialized knowledge and excellent work.

Credit: Phil Grout 13 Producer Profile: Kuapa Kokoo Cocoa Farmers Union Credit: Fair Trade Federation When internal marketing of cocoa was liberalized in Ghana in 1993, a group of farmers led by Nana Frimpong Abrebrese established Kuapa Kokoo as a farmer s cooperative to work at improving the social, economic and political well-being of 35,000+ farmers and their families. Kuapa Kokoo uses part of the extra money they receive from Fair Trade to fund schools for girls, who don't have to stay home to work Cocoa is the mainstay of the Ghanaian economy. The market is highly regulated and there are only 27 licensed cocoa buying companies in the country, including Kuapa Kokoo. In the face of competition from megainternational corporations, the cooperative seeks to develop itself into a formidable farmer-based organization capable of mobilizing quality cocoa products, improving the livelihood of members, and satisfying customers. They have invested in corn mills and palm oil extractors, training in soap making, batik and more to provide alternative means of livelihood for farmers during the off-season. Women are at the center of their program, since they believe that "an empowered woman means an empowered family." Rwandan Cooperative Helps Business, Environment & Women s Employment Founded in 2000, The Dukunde Kawa Cooperative (Musasa) cultivates its high quality coffee near a mountain gorilla habitat in central Rwanda. The coop produces high-end coffee for the international market and employs a predominantly female workforce. In 2003, the cooperative built a washing station with funds provided by the Rwandan Ministry of Defense. In exchange for this support, Dukunde Kawa now donates 10 percent of its net profits annually to fund the construction of other washing stations throughout Rwanda. Fair Trade has enabled the Dukunde Kawa Cooperative to establish various social and productive programs including a tree rehabilitation initiative, long-term credit programs for coop members, new homes, and bicycles to ease the transportation of coffee cherries to the central station.

14 Photo courtesy of Handmade Expressions Women Improve Their Status by Acquiring Skills Credit: Handmade Expressions Sharda creates cosmetic and sling bags with intricate bead work, key chains made of tiny beads, pot holders with tiny bead decorations, and other home decor items at a cooperative called Sahaj, in the Dahod district of Gujarat, India. This cooperative started some years ago by volunteers who first got to the area trying to look for a solution to water/irrigation problems. They realized they could do so much more for the people if they empowered them to make and sell crafts. Sahaj's mission is: "socio -economic empowerment of the woman through art and craft based activities to secure her position in society where she can think independently, become a role model for future generations, and above all not have to prove herself because of her gender." To achieve this goal, this organization trains and empowers tribal women groups with vocational education, helping them create functional products and make a living. The group has grown to include more than 2,700 tribal artisans from 52 different villages of the area. Sharda Ben Kochra, Sahaj Women s Cooperative, India Income for the women in this cooperative increased from an average of 500-1000 rupees per month to 3000-4000 rupees per month. Women have also gained social status within their family, community, and various government and banking institutions. Thanks to the success of the program, men started joining and now make up 10% of the group. Fair Trade Helps Children Find Love Credit: MacroSun International One particular artisan family in Nepal, Nanda and her husband Ganesh, have used Fair Trade to uplift themselves as well as many disadvantaged children. The couple makes traditional Nepali drums and other instruments that MacroSun International has sold both retail and wholesale for years. Nanda had herself come from an extraordinarily painful childhood, and had always had the vision to help children who faced challenges like she faced as a child - without parents or educational opportunity. She shared this vision with friends working with MacroSun in the U.S. This vision ultimately led to the creation of "Mitrata-Nepal" ("mitrata" means "friendship" in Nepali). Mitrata has, for nearly ten years, provided food, shelter, education, and perhaps most importantly, a loving home for nearly 100 children in and around the Kathmandu Valley. Fair Trade helped transform Nanda's vision into reality.

Credit: TransFair USA Visually Impaired Woman in India Finds Lifeline in Fair Trade Credit: Ten Thousand Villages For artisans of Blue Mango, a Fair Trade workshop based in Chennai in south India, their work is often a lifeline. One artisan, Bothumani, has been visually impaired since birth. Suffering from poverty & hunger, she found an opportunity to empower herself at Blue Mango, which focuses on employment for marginalized women: widows, the abused, abandoned or physically or mentally disabled, and those affected by HIV/AIDS. Blue Mango facilitates training, employee ownership and empowerment, and produces silk and cotton bags, pillows, jewelry and ornaments. Bothumani found her niche, and became another example of a motivated woman lifting herself up through Fair Trade. Fair Trade by Some Numbers Today, more than five million people - farmers, artisans, workers and their families - across more than 60 producer countries participate in Fair Trade. Global retail sales of Fair Trade goods have surpassed $4 billion annually, including $2 billion in the U.S. In recent years, coffee has been king. In 2008, for example, coffee represented 80% of all Fair Trade Certified (FTC) retail sales in the U.S. Additional income to farmers, from U.S. sales of certified Fair Trade items, beyond what conventional business would have generated, grew 74% in 2008 to $65 million. Since 1998, sales of certified Fair Trade goods in just the U.S. have generated an estimated additional $150 million for farmers, farmworkers and their organizations. Most of this additional income comes from sales generated by partially committed businesses, even though only 1-40% of each business annual sales are Fair Trade products. About 95% of all annual sales of Fair Trade goods in the U.S. is made by these partially committed businesses. Fair Trade Organizations (FTOs), which essentially sell only Fair Trade goods, generate the other 5% of all retail sales of Fair Trade goods in the U.S. There are about 300 such FTOs in North America, that work primarily with artisans, rather than farmers, in developing countries. These organizations, members of FTF Sugar cane farmer cuts sample to taste 15

16 and WFTO, generate annual retail sales of approximately $200 million, mostly from handcrafts. Among the overseas producers trading with these FTOs 76% of Fair Trade production is done by women and 69% of artisans and farmers involved in Fair Trade are ethnic minorities. Fair Trade producers in over 60 developing countries supply the Fair Trade system. The producers have formed around 1000 Fair Trade producer organizations. The largest part of this system are the producer organizations supplying Fair Trade Certified products in FLO s global system. The distribution of FLO producer organizations by country can be sensed in the following data: Number of FLO Certified Producer Organizations by Country 2008 Credit: TransFair USA Another way to gauge the involvement of various countries is to examine where Fair Trade certified coffee, 80% of all Fair Trade sales, is imported to the U.S. from: FTC Coffee imported to the U.S. -from total of around 88 million lbs. in 2008 Credit: TransFair USA

Credit: FLO Fair Trade consumers in about 20 countries create demand for this supply. However, demand for Fair Trade products is growing in developing countries. The biggest consumer countries are: 17 Fair Trade Sales 2008 (in millions of dollars) Credit: FLO Scores of Fair Trade product types are now available in the U.S. Around 15 product types are already available as certified Fair Trade products, listed in the Certified Fair Trade Products box. Scores more are available from FTOs, such as those listed in the Fair Trade Product Types Sold by FTOs. Retail sales of Fair Trade products grew by around 22% globally in 2008, to $4 billion. FTC coffee sales grew 14% worldwide in 2008, and 28% in the U.S. FTC coffee represented approximately 4% of global coffee production in 2007. Variety of Fair Trade Certified Products millions of dollars Certified Fair Trade Products, with Estimated Additional Profits to Producers in 2008 Coffee $32,637,000 Bananas $637,610 Tea $473,954 Sugar $303,891 Flowers $302.835 Cocoa $261,752 Wine $19.456 Honey $18,125 Vanilla $11,819 Rice $5,085 Olive Oil n/a Sports Balls n/a Body Care n/a Total $34,671,528 Additional profits calculated as profits above what conventional markets would have generated, due to U.S. Sales in 2008

18 Credit: www.fairtradesports.com Fair Trade products have become widely available online, as well as through bricks and mortar retail outlets. Over 2700 retailers, wholesalers, and manufacturers worldwide are licensed to use the certified Fair Trade label on their products. Around 800 of these organizations are in the U.S., with 500 selling coffee. Starbucks FTC purchases in 2008 represented 10% of global FTC purchases, 20% of those in U.S. Starbucks sold around 4% of all its coffee as Fair Trade in 2008, but generates more sales of Fair Trade products than any other retailer. Major Brands Selling Some Fair Trade Certified Products: Coffee Shops: Dunkin' Donuts, Seattle's Best Coffee, Caribou Coffee, Peet's Coffee and Tea, Starbucks Coffee Grocery Stores: Safeway, Sam's Club, Target, Trader Joe's, Wal-Mart, Whole Foods Market Other Shops: Ben & Jerry's Scoop Shops, Bruegger's, Einstein Bagels Some manufacturers purchase large amounts of Fair Trade products, even though these purchases may represent less than 1% to 30% of their total purchases. Notable manufacturers, in alphabetical order: Green Mountain Coffee Roasters Nestle Smuckers (Millstone) Sara Lee The largest FTOs in N. America each generated sales around $10-40 million in 2008. In alphabetical order, they include: Dr. Bronner s Magic Soaps Equal Exchange SERRV Ten Thousand Villages USA Ten Thousand Villages Canada Excellent sources for additional data on Fair Trade include Fairtrade Labeling Organizations (Annual Report), TransFair USA (Almanac), and Fair Trade Federation (Trends Report). Fair Trade products available through FTOs: Body Care Cards / Stationary Clothing Decorative Art Handbags and Totes Home Textiles Furniture Jewelry Musical Instruments Religious Items Sports Equipment Toys Baby with soccer ball

Credit: Handmade Expressions 19 Brief History of FT North America s oldest Fair Trade Organizations (FTOs) began buying handcrafts from impoverished Puerto Ricans and Europeans after World War II and later shifted their focus to developing nations. Called Alternative Trade Organizations during their first decades, most of today s FTOs began during the 20th century as missionary projects, humanitarian efforts or political/economic action statements. Non-governmental organizations also significantly advanced the Fair Trade movement, often leveraging the marketing expertise of FTOs to aid SURE Artisan populations in developing regions. In North America, the church-related organizations are the oldest and among the largest fair traders. Economic-development FTOs started in Europe in the 1960s, when the Dutch division of Oxfam opened its first shops selling goods produced by cooperatives in developing regions. By the mid-1980s, more than 1,000 Third World shops were operating in the United Kingdom and Switzerland. Around the same time, the Dutch organization Max Havelaar created the first Fair Trade product certification system (for coffee) and label. (Fair Trade is) a very attractive concept, across the political spectrum. People like the idea of helping people, not with handouts but with an opportunity to work hard and decently. Daniel Salcedo, Founder and CEO of www.peoplink.org & www.openentry.com. In North America, the 1970s and 1980s saw a surge in the creation of economic/political FTOs such as Global Exchange and Pueblo to People, often in response to strife in developing nations and a growing awareness that the gap between rich and poor was widening. North American advocates, who lack the level of government support that Europeans have enjoyed, found their most receptive customers in several populations university students, co-op shoppers, faith-based organizations, organic and community-farm proponents, environmentalists, and organized labor. Opposite this page is a timeline of key events in Fair Trade history, with further explanations of pioneering and other major nonprofit organizations afterwards.

20 1946 Edna Ruth Byler imports needlecrafts from low-income women in Puerto Rico, and displaced in Europe, laying groundwork for Ten Thousand Villages, N. America s first Fair Trade organization 1949 Church of the Brethren establish SERRV, N. America s second Fair Trade organization, to import wooden clocks from German refugees of WWII 1968 United Nations Conference on Aid and Development (UNCTAD) embraces Trade not Aid concept, bringing Fair Trade into development policy 1969 Oxfam and other European humanitarian organizations open the first World Shop, in the Netherlands, to sell crafts, build awareness, and campaign for trade reform. 1972 Ten Thousand Villages opens store, the first Fair Trade retail outlet in N. America 1986 Equal Exchange established as 1 st Fair Trade cooperative in N. America, importing coffee from Nicaragua as a way to make a political statement with a high quality, household item 1988 Farmers and activists launch the first Fair Trade certification system, Max Havelaar, in the Netherlands, to offer third-party recognition and a label of Fair Trade products Fair Trade Timeline 1945 2010 1989 International Fair Trade Association (IFAT), (now WFTO), established by Fair Trade pioneers as first global Fair Trade network 1994 Fair Trade Federation formed, as first network of FTOs in N. America 1997 Fair Trade Labeling Organizations formed, which led to a third-party label in the U.S. in 1998 managed by TransFair USA 2004 Producers form national and regional Fair Trade associations across Asia, Latin America and Africa. COFTA, for example, was established by African producers to be the continental voice in lobbying for greater market access and Fair Trade advocacy. COFTA is currently composed of over 70 member organizations from 20 African countries. 2005 750 people participate in Fair Trade Futures, the largest Fair Trade conference in N. America 2007 Fair Trade retail sales in U.S. top $1 billion, worldwide tops $2.5 billion 2009 65,000 people, at over 450 events around N. America, participate in World Fair Trade Day, the largest event in the annual Fair Trade calendar

Major Names in Fair Trade 21 Since thousands of for-profit businesses are involved in importing, wholesaling and retailing Fair Trade products, we mention only some pioneers, identified in the timeline above. Some major nonprofit players in the Fair Trade movement are described below. Major retailers and manufacturers are listed at the end of the "Fair Trade by Some Numbers section. Listing in alphabetical order: Catholic Relief Services Catholic Relief Services (CRS), located in Baltimore, Maryland, is the official international humanitarian agency of the U.S. Catholic community. The CRS Fair Trade Program creates opportunities for people to bring the values of their faith to bear in the marketplace, and to make consumer choices that help lift brothers and sisters around the world out of poverty. In 1995, CRS began partnering with SERRV to launch the Work of Human Hands parish sales program. CRS Fair Trade program builds awareness of Fair Trade, and particularly promotes sales of coffee, chocolate and handcrafts. CRS also makes grants to support the activities of artisans and farmers overseas and Fair Trade allies in the U.S. www.crsfairtrade.org Cooperative Coffees Organized in 1998, Cooperative Coffees (CC) is a green coffee importing cooperative, comprised of 23 communitybased coffee roasters in the USA and Canada, who are committed to building and supporting fair and sustainable trade relationships for the benefit of farmers and their exporting cooperatives, families, and communities. CC works in partnership with farmer cooperatives in Latin America, Asia and Africa local organizations founded and democratically governed by the farmers themselves, to import coffee, offer producer tours, and advocate for Fair Trade. www.coopcoffees.com Equal Exchange In the United States, three food co-op members, Rink Dickinson, Jonathan Rosenthal and Michael Rozyne, began Equal Exchange in 1986 to promote social change for farmers worldwide and to provide high quality food products to the American market. They first began importing Nicaraguan coffee as a worker owned co-op. EE has grown into the largest fully committed Fair Trade organization in N. America, with annual sales around $35 million. www.equalexchange.coop

22 Fair Trade Federation Fair Trade Federation (FTF) was formed in 1994, as the first network of FTOs in N. America. FTF now consists of about 250 wholesalers and retailers with annual retail sales on the order of $160 million. Most of these sales have been from handcrafts, not from food, drinks or other commodities. Located in Washington, DC, FTF is a trade association, whose mission is to strengthen and promote North American organizations fully committed to Fair Trade. The Federation is part of the global Fair Trade movement (formally a partner network of WFTO), building equitable and sustainable trading partnerships and creating opportunities to alleviate poverty. The largest Fair Trade conference in N. America, Fair Trade Futures, was co-hosted in 2005 by FTF and Fair Trade Resource Network (and will be in September 2010) www.fairtradefederation.org Fair Trade Labeling Organizations In 1997, labeling initiatives in several European countries came together to form Fairtrade Labeling Organizations (FLO) as a single international system for monitoring and labeling Fair Trade products. Headquartered in Bonn, Germany, FLO aims to increase producers security and sustainability by establishing transparent relationships. Their mission is to connect consumers and producers through a label that promotes fairer trading conditions. FLO is comprised of 24 organizations around the world that provide the FAIRTRADE Mark certifying that international Fair Trade standards are being met. www.fairtrade.net Fair Trade Resource Network Fair Trade Resource Network (FTRN) is a non-profit organization founded in 1999 for Fair Trade education and dialogue. FTRN seeks to improve peoples lives through Fair Trade alternatives by providing information, leadership and inspiration. FTRN is the only N. American organization exclusively devoted to Fair Trade education and dialogue. It is also distinguished by its inclusiveness of the wide range of Fair Trade players in its information and programs. Major programs include: a website about Fair Trade resources, news and activities; coordinating the largest annual Fair Trade event in N. America, World Fair Trade Day; producing publications like a Fair Trade calendar and booklet; co-hosting the largest Fair Trade conference, Fair Trade Futures; compiling the largest online directory of Fair Trade academic and research papers; and more. www.ftrn.org

23 Fair Trade Towns USA Fair Trade Towns USA is a national movement uniting community activists, businesses, and community groups from across the country who are dedicated to the principles of Fair Trade. The U.S. campaign is based on principles and guidelines set forth by FTTs in the U.K., where the first Fair Trade Town, Garstang, Lancashire, was recognized in 2000. Over 600 FTTs, mostly in Europe, now build awareness and support for Fair Trade across 3 continents. There are currently 13 declared FTTs in the U.S. and scores of other active coalitions pursuing recognition. In 2008, TF USA temporarily began caretaking the formerly independent organization, to incubate it back to health during a several-year period. www.fairtradetownsusa.org Global Exchange Global Exchange (GX) is an international human rights organization based in San Francisco, California, that promotes social, economic, and environmental justice around the world. Along with promotion of collective action, hosting of reality tours around the world, and sponsorship of CODEPINK and other local action networks, GX operates Fair Trade stores in five locations as well as online. GX leads major Fair Trade action campaigns, such as Reverse Trick-or-Treat, Valentine s Day of Action, and Fair Trade Holiday Caroling. www.globalexchange.org Green America Founded in 1982 as Co-op America in Washington, DC, Green America seeks to harness economic power to promote social justice and environmental sustainability through economic strategies, mobilization and collective action. Green Ameica serves the Fair Trade community as public educators, encouraging people to support Fair Trade while providing them the means to do so. Major programs include publishing a Consumer Guide to Fair Trade, producing annual Green Festivals that include designated sections for Fair Trade businesses, and co-leading Fair Trade action campaigns. www.greenamericatoday.org/programs/fairtrade

24 Lutheran World Relief Lutheran World Relief (LWR) is a non-governmental organization founded in 1945 to respond to the needs of communities devastated by World War II. Since then, it has evolved into an agency that works with partners worldwide to respond to emergencies, seek lasting solutions to rural poverty, and work for peace and justice for all. In 1996, LWR began partnering with Equal Exchange to launch the first faith-based Fair Trade coffee initiative in the U.S. LWR also partners with SERRV to promote Divine Chocolate and handcraft sales to Lutherans across the U.S. www.lwr.org/fairtrade Max Havelaar Foundation When world coffee prices drastically declined in the 1980s, a new effort was created in the Netherlands to aid distressed coffee farmers around the world. In 1988, a coffee cooperative in Oaxaca, Mexico, called UCIRI, teamed with Solidaridad, Father Franz van der Hoff, Nico Roozen, and other advocates to form Max Havelaar, whose name is based on a fictional Dutch literary character who opposed the exploitation of coffee farmers in the colonies. For the first time, a third party employed a systematic and standardized system of Fair Trade criteria to label products. In 1997, similar labeling initiatives in several countries came together to form Fairtrade Labeling Organizations, which helped found TransFair USA. www.maxhavelaar.ch/en Network of European World Shops Humanitarian relief organizations, such as Oxfam, created Third World Shops in 1969 across Europe to sell crafts from disaster-stricken countries, build awareness of development needs, and campaign for reform in trade policies. In 1994, 2500 shops across Europe organized a new network, called NEWS!, to coordinate campaigns. SERRV To help European refugees recover from the effects of WWII, The Church of the Brethren established Sales Exchange for Refugee Rehabilitation and Vocation (SERRV) in 1949, and became the 2 nd Fair Trade organization in N. America. Today, SERRV has relationships with 75 community-based organizations in 36 countries. SERRV helped found the World Fair Trade Organization and the Fair Trade Federation. www.serrv.org

25 Ten Thousand Villages In 1946, Edna Ruth Byler of the Mennonite Central Committee began importing textiles from women in Puerto Rico to sell in the United States and brought the profit directly back to the artisans. Her work inspired the creation of Ten Thousand Villages in 1958, which today provides textiles, jewelry and handcrafts from over 130 artisan groups in more than 38 countries. After opening N. America s first Fair Trade retail store in 1972, Villages has grown to over 110 retail stores throughout the US and Canada. www.tenthousandvillages.com TransFair USA Since no third-party label existed yet in the U.S., the Institute for Agriculture and Trade Policy led the creation of TransFair USA (TF) in 1998. Despite the emergence of some minor labels in the past few years, TF s Fair Trade Certified mark is the only widely recognized certified Fair Trade label in the U.S. Located in Oakland, CA, the nonprofit organization seeks to enable sustainable development and community empowerment by cultivating a more equitable global trade model that benefits farmers, workers, consumers, industry and the earth. At present, over 800 licensees around the U.S. participate in TF s model. www.transfairusa.org World Fair Trade Organization Formed as IFAT in 1989 by over 40 FTOs in Europe, the first global network of FTOs become World Fair Trade Organization (WFTO) in 2009. The network is a global representative body of over 350 organizations operating in 70 countries and comprised of around 110 million artisans, farmers, growers, producers, and supporters. Their goal is to enable small producers to improve their lives and communities by delivering fair market access and advocacy, campaigning, marketing, and monitoring. www.wfto.com There are scores of other nonprofit players in the Fair Trade movement, including other faith-based organizations, student groups, international development organizations, trade policy outfits, and labor rights groups.

26 Credit: Handmade Expressions Challenges Facing As Fair Trade grows in popularity among producers, consumers and retailers, challenges emerge. While Fair Trade advocates are united in their desire to improve conditions and opportunities for disadvantaged producers, they often disagree on how best to accomplish that. Struggling with complex issues is actually evidence of a healthy movement. Participants now grapple with new and decades-old questions, such as these key ones: Reform or Replace Conventional Trade? Perhaps the thorniest dilemma confronting Fair Traders in the early 21st century is this: Can Fair Trade achieve its full potential by changing conventional trade from within? Or is it better to develop alternative business models that take market share from mainstream companies and force them to meet higher standards? A small body of determined spirits fired by an unquenchable faith in their mission can alter the course of human history. M. Gandhi Mirror work embroidery, India Those who favor changing the system from within say that encouraging mainstream businesses to carry a few lines of Fair Trade items introduces the concept to vastly more consumers, benefiting far more producer families and communities. A differing view holds that developing alternative business models that capture significant market share will inspire higher standards in mainstream