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111. Fair Trade and social impact

This week, I have I shared some reflections on the connection between Fair Trade and coffee quality (part 1part 2part 3).  Today, I revisit the issue of Fair Trade’s social impact — a topic of perennial debate that has been renewed in recent weeks by a number of publications that take a critical look at the gap between the rhetoric and reality of Fair Trade.

Here in the United States, the current issue of Conducive Magazine asks “Does Fair Trade Coffee Eliminate Poverty?”  The short answer, of course, is: “No.”  The longer and more nuanced answer that the article provides, however, includes some thoughtful and helpful analysis of poverty in Fair Trade coffee supply chains.  It references the groundbreaking household-level surveys that Green Mountain Coffee Roasters conducted in partnership with the Colombia-based research institute CIAT both as evidence that the problem persists and as encouragement that something — beyond just more Fair Trade — can be done about it.

In the UK, the free-marketeering institute of economic affairs released a report earlier this month titled “Fair Trade Without the Froth” (summaryfull report) that has generated some discussion about the real impacts of Fair Trade.  The British daily The Guardian ran two pieces on the report: one a balanced article in its Global Development section, the other a passionate rebuttal in the paper’s Money Blog.  In my quick review of both the report and the Guardian coverage, I found that the coverage (predictably) seized on the most critical passages of the report, which in many ways seemed to be even-handed and reflect lots of what we have experienced in our work with Fair Trade and coffee in Central America and Mexico.

More generally, I am pleased to see people taking a critical look at Fair Trade and not simply giving it a free pass on the basis of its explicit motivation to reduce poverty and give smallholder farmers a fair chance in an economic system that rewards size and scale.  I believe that many advocates of Fair Trade (a label I would apply to myself) have invited this kind of critical inquiry by overstating the case for Fair Trade (again, something I believe I have been guilty of in the past).  I don’t think any fair-minded assessment could suggest that Fair Trade has not had a positive impact, but I think it is true beyond a shadow of a doubt that Fair Trade has not lived up to the outsize expectations that have been created by some Fair Trade advocacy and promotional campaigns.

At the 2010 SCAA conference, I made a presentation on hunger in the coffeelands during which I tried to suggest that, at least as far as hunger is concerned, the problem may be more one of expectations than impact.  This slide from the presentation identifies three sets of risk factors for hunger — availability of food, access to food and utilization of food.

Fair Trade is focused primarily on addressing the risk factors associated with access to food.  I think the record suggests it has actually helped farmers address many of these risk factors effectively.  But in the absence of other kinds of activities to address the other sources of smallholder vulnerability to food insecurity, the needle has not moved much on hunger in Fair Trade coffee communities.  While critics might seize on this as evidence of Fair Trade’s failure, I see it more as a failure to understand the complexities of hunger, to communicate appropriately and to set fair expectations for Fair Trade.

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