How Fair is Fairtrade?
The recession will refocus our financial priorities, and is as good a time as any to reassess the value of Fairtrade products
After some exceptionally fat years, it appears that lean times have now arrived. As Britain heads for recession, our historically low food prices have risen fast, and show every sign of staying high for the foreseeable future. With mortgage payments hurting, middle-class shoppers have begun learning the route to Aldi and Lidl rather than Waitrose and M&S.
As politicians scale back their spending plans, all of us have to quiz ourselves much more closely about the value that we are getting for our money. Is that designer coffee really worth a good chunk of a fiver? How much tastier is an organic turnip? And is supporting Fairtrade the best way to help poor producers?
Fairtrade exploded in Britain in our boom years. However, Ernst and Young brought out a report earlier this year arguing that Fairtrade consumer choices were likely to suffer as our finances became more straitened. And that was before the international banking system turned into the House of Usher.
It is only right when we have less money to spend that we should hold Fairtrade to a high standard. The truth is we can put our money to better use. Fairtrade arbitrarily favours certain farmers, by no means necessarily the poorest, and draws trade away from those outside its umbrella. Those it assists are forced to adopt a co-operative management system potentially open to corruption and resistant to rapid economic development. Its complex system of certification means that the farmers have to pay very high fees to take part, without a guarantee that they will sell any of their crop at the Fairtrade minimum price at all. The development economist Peter Griffiths is only the latest expert to come out against the label.
Today, the internet allows us to give much more directly. Go to kiva.org for example and you can make a loan to entrepreneurs in the developing world. At globalgiving.com you can donate to micro-regeneration schemes. This is the way to get the most bang for your charitable buck. Meanwhile, buying cheap food is not to let down the poor: it is the expensive trend to locally produced food that has the poor farmers in Africa despairing. Buying cheap and giving directly will help us all make the best of these hard times.