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What To Know About The Fair Trade Market

By Lila Barry

Fair trade is a term that is used to describe a fair trade market or market-based strategy that involves helping producers who are operating in developing parts of the world to make better exchanges and support sustainability efforts. This is considered a social movement and encourages higher prices be charged to exporters. It also promotes a different set of guidelines, socially and environmentally.

There is not a single definition that is used for this term. However, a common description of this practice is a kind of partnership in which equity is sought in international trading. The market is mostly based around dialogue, respect and transparency. Sustainability development also plays a major role in this industry, as improving the exchange benefits of countries, producers and workers is a top priority, especially in the South.

In general, this industry works with exports between parties in developing countries and parties in developed nations. Tea, bananas, cotton, flowers, wine, chocolate, honey and cocoa are among the items that are often exchanged in the market. The first attempts at commercializing goods under this practice occurred during the 1940s and 50s in Northern markets. It was initiated by religious and non-government groups that were politically involved.

The two basic ways these items are traded and marketed: MEDC supply chain and product certification. MEDC refers to products that are distributed or imported solely via these trade organizations. Product certification relates to products that have been certified to guarantee compliance with all guidelines for this industry.

Most organizations that are part of this movements include active members of federations, or have received certification from these entities. The national and international federations handle all of the coordinating, facilitating and promoting that goes into this market and its organizations. NEWS, FLO, EFTA, and The World Fair Trade Organization are just some examples of the largest and most known federations that operate in the industry.

There is some criticisms that are directed at this market and its practices. One of the main issues is related to ethics, as the money that is collected does not typically make it to the original producers. Instead, it is shared among co-operative businesses and employees.

Additionally, most consumers pay a higher cost for these items because they are under the false impression that all of the revenue is going to support the poor manufacturers in other parts of the world. Some other criticisms and concerns associated with this industry: corruption, political objections, absence of monitored standards, where revenue goes. There are also many supporters who believe that these types of products are the best and only way to go, and fully support the concept that the industry was developed on.

The fair trade market is part of a new movement and approach in which emphasis is placed on improving transactions made by producers located in developing countries. It involves development of equity in trade deals and sustainability. Products that are distributed by way of such markets or organizations must meet all the special regulations that are in place. There are people who are for and against this type of setup.

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