The last post was about International Fairtrade; this time, I am trying to figure out if the World Fair Trade Organisation (WFTO) is doing a better job than the Fair Trade label.
WFTO is also claiming to support small producers, saying on their website the following:” The organisation supports marginalised small producers, whether these are independent family businesses, or grouped in associations or co-operatives. It seeks to enable them to move from income insecurity and poverty to economic self-sufficiency and ownership “. This is their number one principle. There are also other principles, including women’s empowerment, child labour, and forced work control. My text focuses on fairness towards small producers.
The WFTO annual fee consists of a membership fee, a monitoring fee, and a regional fee. Information is based on WFTO’s Annual Fee Structure 2015, which can be found on their website. The following example is theoretical and differs from the one I posted last time because WFTO’s fees are based on yearly turnover. In contrast, Fairtrade International’s fees are based on the number of workers. In my opinion, WFTO’s approach is better because the number of workers does not provide a clear indication of the annual turnover rate. One producer might have a few excellent workers and a reasonable turnover rate, while another producer might have more workers but a weak turnover rate. In the International Fairtrade system, the last-mentioned is paying more, which doesn’t make sense.
To obtain a WFTO label, the producer has to pay an application fee, which is based on yearly sales: the more you make, the more you pay. The application fee is a minimum of 100€ and a maximum of 750€.
Example:
The producer’s yearly sales are under 135,000 per year, so they have to pay 100€ for the application fee.
Annual fees:
Membership fee: 375€
Monitoring fee: 25€
Regional fee*: 100€
Total: 600€ in the first year and after that 500€
So, in theory and practice, WFTO is fairer than International Fairtrade; however, there is still the same problem that if the average monthly income is less than 50€, small producers under WFTO are relatively still ignored. They are smaller than the ones under the International Fairtrade label, but not actually small producers. The following post will have examples of organisations that are playing fairly.
By: Tia Maria
