In 1964, the global community gathered in Geneva for the United Nations Conference on Trade and Development. It was here that representatives from nations in the global south made a collective call for better and stronger commercial exchanges between northern and southern countries, asking for “trade, not aid.” In the decades since, fair trade has become one avenue with the potential to meet this request for stronger and more respectful trade partnerships.
Fair trade took root in Christian movements over sixty years ago in England, France, the United States, and the Netherlands. Over the years, it has grown through a variety of certification bodies to reach global sales of nearly five billion dollars in over 20 different products. Fairtrade International (FLO) is one such certifying body. It has succeeded in fostering a niche market to occupy an important, if not still limited, part of the global marketplace. This organization now unites over 74 producing countries and millions of people, of which over 850,000 are African farmers and workers.
If fair trade is one response to the call made over 50 years ago by southern countries, what has the actual impact been on producing communities? Here we will briefly examine the social, economical, and political impacts of Fairtrade certified cotton in Mali and Burkina Faso, two of the largest cotton producers in Africa and among the poorest countries in Sub-Saharan Africa.
West African cotton industry
For West African producers, the introduction of Fairtrade-certified cotton in 2004 was revitalizing, given the 70 percent decline of global cotton prices since 1990. In addition to volatile exchange rates, the increasing popularity of synthetic fibres, technological improvements, and China’s fluctuating role as either an exporter or importer, the major contributor to the declining prices was largely criticized as American cotton subsidies. Certain studies estimate that the elimination of these subsidies would increase the world prices by 6 to 14 percent and thus increase West African farmers’ revenues by 8 to 20 percent.
The cotton management systems are somewhat similar in both Mali and Burkina Faso. In the former, a public enterprise, the Compagnie Malienne pour le Développement des Textiles (CMDT), manages cotton production. In the latter, the industry is run by a joint entity comprising SOFITEX (a private company), Geocoton (previously DAGRIS, a French holding company), and the government of Burkina Faso. Essentially, the organizing body in each nation manages cotton production by selling seeds to producers on credit, helping them find equipment, and offering technical and capital support. Producers then pay back their debts when the organizing body purchases their harvest at a fixed price. It’s important to note that the fixed-price scheme encourages a higher quantity of product at the expense of quality. Fairtrade certifications are granted to the co-operatives producing the best-quality cotton and also meeting FLO standards; therefore, the higher, guaranteed Fairtrade prices give farmers an incentive to improve their product.
Social impacts
Gender
Data on female participation in the co-operatives looks promising at first glance. When Fairtrade cotton launched in Mali in 2004, 17 percent of the 588 producers were women. By 2006, over 1200 women were producing Fairtrade-certified cotton—40 percent of all Fairtrade-certified cotton producers in Mali. By 2012, one region, Yanfolina, boasted nearly 50 percent women producers, including four who were co-operative presidents.
It is important, however, to respect the theory of cultural relativity. One study published in Mondes en Développement in 2012 found that the increase in women’s participation was not an indicator of success, but rather of men’s distrust of the FLO system. They preferred to maintain the status quo by working with the conventional market rather than risk the unknown by transferring to FLO. Certain interviews with Malian workers also revealed that participation by one or more of a man’s wives in the co-operatives resulted in uncomfortable cultural transformations that left the husband sometimes feeling ashamed for not adequately providing for his family. More research is needed to clarify how fair trade principles affect a society’s culturally embedded expectations, including gender roles.
Education
Educational impacts are largely positive, with the Fairtrade Premium allowing bottom-up initiatives, such as the creation and maintenance of schools, to flourish. The Dougoroukoroni co-op in Mali was the first all-women cotton co-operative to receive a Fairtrade Premium. They invested it directly into the construction of a school—which was immediately filled with eager students. Also, higher salaries allow farmers to hire workers, thus freeing their children to attend school.
Economic impacts
The economic benefits of Fairtrade production are easily identifiable. In Mali, the fixed FLO price of 238 West African CFA Francs per kilogram (CFAF/kg) is considerably higher than the average world price of 180 CFAF/kg. Fairtrade International pricing provides stability and predictability, allowing farmers to plan their next crop and send their children to school.
Lesser known are the indirect economic effects of FLO certifications. One study shows that cotton quality increases by 7 percent in FLO co-operatives and by 5 percent in neighbouring conventional co-operatives due to technique sharing. Additional revenues to both FLO and conventional co-operatives because of superior quality could increase the market value of all West African cotton. Finally, higher revenues result in more start-up companies, which can, in turn, create wealth.
Political Impacts
Fairtrade seeks to counter the neoliberal capitalist system, which is based on competition, with an alternative system based on transparency, democracy, and social justice. Even though this approach is still unconventional, the rising consumer demand for socially responsible products has encouraged its adoption in mainstream markets. It’s important to ensure that the integration of large, multinational corporations challenges, rather than exacerbates, exploitation and social inequalities.
The organization of work in the form of co-operatives is not a new concept for West African workers. In fact, McSween and Favreau, in a co-authored chapter of Mettre en marché pour une cause, note that the solidarity practices of traditional African societies provide a particularly fertile ground for the development of co-operative–type projects. The FLO standards do, however, add several advantages. From a micro-economical perspective, the communal decision-making process encourages local wealth redistribution, especially with social project investments from the Fairtrade Premium. Additionally, because Fairtrade standards require proportional representation, women are more involved, especially with regards to the investment of the Fairtrade Premium. From a micro-institutional perspective, FLO equips workers with the tools necessary to operate transparently and democratically. Finally, non-FLO co-operatives tend to unionize more often when a FLO co-operative is located nearby.
The fair trade movement has expanded over the years as it attempts to answer a 50-year-old demand for “trade, not aid.” A review of the social, economic and political transformations in communities with Fairtrade-certified cotton co-operatives reveals that this type of trade is largely beneficial to the participating farmers and the communities that surround them.
Author: Krista Pineau | Krista has been involved with the Fair Trade movement since 2012 working on Fair Trade Town and Campus campaign. Krista served as a member of the Canadian Fair Trade Network’s board of directors until January of 2016.
“West African Fair Trade Cotton: Understanding the impacts on producer communities” was orginally published in the Summer/Fall 2015 Edition of Fair Trade Magazine