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With Fair Trade Malawi Has Assistance In Supporting Its Farmers

By Lila Barry

Small farmers are disadvantaged in international trading. With fair trade Malawi farmers have a way to earn a better living. This is because growers under its umbrella are guaranteed payment above global market prices.

This is extremely important for a very poor nation where 85 percent of the labor force is confined to the agricultural sector. This country is one of the most densely populated countries in Africa. It has a national average of family landholdings of just 1 hectare. Yet, agriculture is vital to the economy constituting 90 percent of foreign export income and 35 percent of GDP.

In one of the poorest parts of Africa, the life span is relatively short and child mortality rate is high. Its GDP per capita remains below half the subSaharan average. The poverty of the majority of the population has also caused the highest inequality on the African continent.

Agricultural production was liberalized in 1994. This change brought new challenges. Liberalization caused a huge decline in commodity prices. Middlemen cheated smallholders out of their deserved earnings after 2004 when Government stopped directly purchasing goods.

Agriculture sector learned that by collecting together the organized producers can get better prices. The National Association of Smallholder Farmers, NASFAM, today represents over 108,000 farm families. Supportive institutional infrastructure has helped to provide training and establish quality management systems. Cheated producers now have another route to prosperity to earn the fruits of their labor with the added support of the international trading partnership to boost their efforts.

The force behind this partnership is the vision of the Fairtrade Foundation. Its primary goal is to bring greater equity in the international agricultural markets. Minor producers are offered improved trading terms. But to join they must first commit to certain norms. These are the economic, environmental and social standards set by the body. Social norms require the respecting of labor rights and democratic decision-making processes to members the opportunity to participate. The economic standards guarantee a minimum price. This price covers both production costs and an additional amount that may be utilized for a development purpose. The environmental standard encourages sustainable business and agriculture practices. Presently there is a focus on diversifying to bring added value. There is hope this will bring more local processing opportunities to create more jobs and improve prospects for the development of regional markets.

Buyers are encouraged to participate in long term contracts and to offer pre-financing. This helps to level the playing field. It also guarantees a trading system which offers traceability and transparency to consumers. This makes them more willing to pay the higher prices such products may demand. But more consumers are keen to support ethical practices, especially as more are learning of the short cuts large producers take that may detrimentally affect their health.

Certification guarantees the principles are followed along the supply chain. Since its introduction in 2004 over 12,400 smallholders have been able to gain entry into the global market this way. The small farming families of the nation have seen significant impact in the commodities initially covered by the partnership. In tea, groundnuts and sugar sales there has been a promising increase in market share, according to a 2010 study. With the support of fair trade Malawi has help in reducing its poverty.

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