Fair Trade Myths and Realities

Your Purchase_creates work_builds communitiesOctober is Fair Trade Month! As members of the Fair Trade Federation, we are dedicated to 360° fair trade.  360° means we work with artisans in partnerships built on trust.  It means good wages, safe working conditions, environmental responsibility, and more.  It means our partners are empowered to build strong businesses for their families today – and for generations to come. Do you have any misconceptions about Fair Trade?

Myth: Fair trade is about paying developed world wages in the developing world.

Reality: Wages are designed to provide fair compensation based on the true cost of production, and are not based on North American wage standards. Fair wages are determined by a number of factors, including:

  • The amount of time, skill, and effort involved in production
  • Minimum and living wages where products are made
  • The purchasing power in a community or area
  • Other costs of living in the local context

Myth: Fair trade siphons off American jobs to other countries.

Reality: Fair trade seeks to improve the lives of the poorest of the poor who frequently lack alternative sources of income. Most fair trade craft products stem from cultures and traditions which are not represented in North American production.

Myth: Fair trade is anti-globalization.

Reality: International exchange lies at the heart of fair trade.  360° Fair Trade Organizations seek to maximize the positive elements of globalization that connect people, communities, and cultures through products and ideas. At the same time, they seek to minimize the negative elements that result in lower labor, social, and environmental standards which hide the true costs of production.

Myth: Fair trade is a form of charity.

Reality:  360° fair trade promotes positive and long-term change through trade-based relationships which build self-sufficiency. Its success depends on independent, successfully-run organizations and businesses–not on handouts. While many fair trade organizations support charitable projects in addition to their work in trade, the exchange of goods remains the key element of their work.

Credit: Fair Trade Federation

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