Five-point plan to cut poverty through trade

The Fairtrade Foundation has set out a five-point agenda to reduce poverty through trade, including through the building and support of co-operatives.

In a briefing paper, titled Delivering the Sustainable Development Goals through Trade, the organisation warns that trade is a “blunt tool” that can harm as well as help poverty reduction.

Shivani Reddy, policy manager at the Fairtrade Foundation, said: “When trade deals go wrong, there is risk of serious damage to the lives of large numbers of workers and farmers, and the potential to deepen poverty.

“But when they are designed with sustainable development in mind, they can boost incomes, tackle poverty and deliver a lasting impact.”

A commitment to assessing the impact of new deals on the poorest during early negotiations would be a good start, she added. “Better accountability and transparency to civil society – especially to the people likely to be affected in developing countries – is important. A willingness to deliver robust support for adjustment for farmers and workers affected by trade deals is essential.”

But the true sign of success, she said, “will be when we see ministers putting the poor first, if the national interest conflicts with development priorities”.

In February, the Fairtrade Foundation launched Sugar Crash, a report highlighting the crisis facing sugar cane farmers in developing countries because of an EU reform that will lift the cap on European beet sugar production by 2017.

Small-scale sugar cane farmers in African, Caribbean and Pacific countries will struggle to compete with European farmers, who also receive subsidies from the EU.

“Much of the EU funding that was meant to support sugar cane farmers through CAP reform has either not met the needs of producing communities, been spent on other things or has not been spent at all,” said the briefing.

“In some places the EU has continued to fund the expansion of sugar cane production, despite the threat to the industry.”

Fairtrade now works with 62,000 sugar cane farmers in countries including Belize, Jamaica, Malawi and Zambia – but according to research from the Department for International Development, the end of the beet sugar quota could push 200,000 people in developing countries into poverty by 2020.

“It is crucial that those adversely affected by changes to trade regimes are properly supported to adjust in sufficient time to minimise negative impacts on livelihoods,” added the briefing. “One way of achieving this is through Aid for Trade (AfT).”

Fairtrade says that part of the UK government’s AfT strategy should ensure “better monitoring and targeting of AfT towards small producers that builds on experience of what works for them, for example building co-operative organisations”.

The Fairtrade Foundation calls on UK government to:

1. Ensure that the SDGs on trade are ‘pro-poor’, with indicators that drive fair and sustainable trade for poor communities – not just trade for its own sake.

2. To make sure that the whole government works better together to reduce poverty through trade, sustainable development must be the top shared priority for the UK’s trade goals.

3. To ensure that comprehensive assessments are made of the likely impact of trade decisions on poor communities, the risks of damage to livelihoods and how positive outcomes can be ensured.

4. To ensure that farmers and workers affected by changes to trade regimes receive proper support to help them adjust

5. To use the UK’s influence to ensure that the EU’s trade decisions are fair for farmers and workers in developing countries.