The aim of this essay is to discuss about the comment made by the Adam Smith Institute (2008) about how ‘The Fair-trade movement achieves virtually nothing in terms of reducing world poverty’. Fair trade is a standard that is set to support the developing countries exports, it is to improve the workers in a developing country’s working conditions, fair payments which help them towards development and planning of their future that may help poverty. It also helps them to sell products to developing countries. Fair trade products come mostly in products such as coffee, chocolate and bananas the packaging mostly shows smiling workers that gives the impression that fair trade is such a worldwide success, however Adam Smith Institute (2008) states that ‘Smiling photos may improve turnover, but they cannot speak for the overall effectiveness of Fair-trade certification as a means of poverty relief’, the majority of fair trade consumers do not actually know the extent to which Fair trade is actively reducing worldwide poverty. Some critics of Fair trade argues that Fair trade does not really help to reduce worldwide poverty because farmers are dependent on Fair trade shoppers ,An article on BBC news website states ‘ Yet others argue that fair trade can end up being a trap for farmers, tying them into a relationship of dependence with charity-minded shoppers in the West‘ (2007.) this could further increase the believe that fair trade would rather have farmers be dependent on themselves than teaching them on how to survive on their own. Many people in China and India escaped poverty last year without the help of fair trade, an article on BBC news states ‘that was done through real market developments rather than small-scale fair trade deals. They were lifted out of poverty because they could sell their products on the open global market, rather than being sectioned off in the fair trade market’ (2007).according to that statement is suggest that fair trade does not really have the major impact that its publicised to have in reducing worldwide poverty . Despite being publicized as fair trade is ,it cannot help all the farmers who obviously don’t meet the standards ,an independent newspaper article wrote ‘ Some poorer or remote farmers cannot organise and join up; others cannot afford the fees; still others will be working for larger producers who are excluded from many Fair-trade product lines(2012). The statement explains that the requirements for a fair trade licence are not applicable to some poor farmers, so it questions the effect they are having on reducing worldwide poverty.
Cocoa is widely consumed in every part of the world, Ghana and Ivory coast are the main exporter of cocoa, Fair trade deals are also present with the farmers in these countries, however, this article BBC article ‘the Fair-trade cocoa co-operative in Ghana which supplies Cadbury and Divine, suspended seven out of 33 of their cocoa farming communities in one of its 52 major growing districts in the country after they were found to be using the worst forms of child labour’. (2010). This article showed that child labour still is present under fair trade farming deals, this does not help in reducing the worlds poverty problem .
In terms of major chocolate brand such as Nestle and Cadbury also started using fair-trade cocoa beans, however in this BBC news article it states ‘all may not be what it seems, because despite the logo, your Dairy Milk, Kit Kat, or Maltese’s, may contain no Fair-trade cocoa beans at all’(2012).this explains how other chocolatiers can still get away with mixing non fair-trade beans with fair trade beans ,this is misleading to the public because only a low number of fair trade farmers are getting the correct payments ,therefore it’s not having a significant impact on the reduction of worldwide poverty .
Other countries that deals in fair-trade products benefits more than others ,In the Guardian news article it says ‘ while...