As awareness of fair trade grows, so do many misconceptions about fair trade. Below are some popular myths about fair trade and the realities behind them.
Myth: Fair Trade is about paying developed world wages in the developing world.
Reality: Fair wages are determined by a number of factors, including the amount of time, skill, and effort involved in production, minimum and living wages in the local context, the purchasing power in a community or area, and other costs of living in the local context. Wages are determined independently from North American wage structures and are designed to provide fair compensation based on the true cost of production.
Myth: Fair Trade siphons off American jobs to other countries.
Reality: Fair trade seeks to change the lives of the poorest of the poor who frequently lack alternative sources of income. As North American fair trade organizations grow, they employ more and more individuals in their communities. Most fair trade craft products stem from cultures and traditions which are not represented in North American production. Most fair trade commodities, such as coffee and cocoa, do not have North American-based alternatives.
Myth: Fair Trade is anti-globalization.
Reality: International exchange lies at the heart of fair trade. 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: Fair trade promotes positive and long-term change through trade-based relationships which seek to empower producers to meet their own needs. Its success depends on independent, successfully-run organizations and businesses – not on handouts. While many fair trade organizations support charitable projects on top of their work in trade, the exchange of goods remains the key element of their work.
Myth: Fair Trade results in more expensive goods for the consumer.
Reality: Most fair trade products are competitively priced in relation to their conventional counterparts. Fair trade organizations work directly with producers, cutting out exploitative middlemen, so they can keep products affordable for consumers and return a greater percentage of the price to the producers.
Myth: Fair trade production results in substandard goods for the consumer as compared to conventional production.
Reality: While handmade products naturally include some variation, fair trade organizations continuously work with their producer partners to improve quality and consistency. Through direct and long-term relationships, producers and fair trade organizations dialogue about consumer needs and create high quality products. Fair traders have received awards at the international Cup of Excellence and Roaster of the Year competitions, SustainAbility in Design, the New York Home Textile Show, and other venues.
Myth: Fair trade refers only to coffee.
Reality: Fair trade encompass a wide variety of agricultural and handcrafted goods, including baskets, clothing, cotton, footballs, furniture, jewelry, rice, toys, and wine. While coffee was the first agricultural product to be certified fair trade in 1988, fair trade handicrafts have been on sale since 1946.