Fair Trade, Free Trade and contradictory politics of the UK and EU

Duncan Haslam

From the Fairtrade Foundation Campaign `Pushed into Poverty: Stand by Sugar Cane Farmers`

The UK election approaches and the focus on domestic issues dominate discussions in the media. In manifestos and debates the parties have been preoccupied with defence and security. On global economic development there is a general commitment to maintaining 0.7 percent of government spending on development aid. But we are only given vague clues about commitments to promoting ‘fair-trade’. Only the Green Party has clearly sponsored the importance of fair trade for overseas development (Source). The main political parties are not making a strong and clear commitment to fair-trade even though this can support developing economies. Why might this be the case?

The problem for the main UK political parties is that their policies are prisoners to the European political experiment that is entranced by liberal free market ideology. This follows that policy should be all about reducing costs, prices and increasing market efficiency for consumers in the EU. But, this commitment will mean a progressive cut back in price controls and physical quotas that have gone some way to supporting developing economies through export led growth. This is most evidently the case in EU sugar reforms scheduled to come into force in 2017. Currently these quotas help developing economy sugar producer’s access the EU sugar market but these are to be abolished. These quotas work alongside regulations that cap EU sugar production, in an attempt to control prices for EU farmers but at the same time support overseas development (Source). Further liberal market reforms create a double standard because EU farmers will still be protected under the Common Agriculture Policy (CAP) but outsiders would be forced to compete in a so-called free market. The UK’s main parties have an opportunity to take a stand against these contradictory initiatives but their manifestos are silent.

A future UK government should take a lead on debates on regulating access to the EU by developing economies. This is not just about sugar it is about all commodities that, under a regime of free trade are exposed to global price competition that crowds out the need for sustained economic development in poorer countries. The warning here is that price competition will not generate a secure foundation for economic growth among the developing economies. Department for International development (DFID) reports on reforming EU market access to sugar producers suggest that in affected overseas supplier regions, 200,000 could be left in poverty by 2020 and a total of 6.2 million in total affected (Source). Fairtrade premiums that top-up minimum prices agreed with farmers also support communities and provide socially beneficial infrastructure. In Jamaica, for instance, premiums have been used to help grant access for children to schools and access to health clinics (Source). Furthermore, in countries like Jamaica sugar cane is the staple crop and it’s not easy to move into new agricultural products such as Cocoa overnight (Source) .The EU political commitment to a liberal free market ideology threatens to undo economic progress in the underdeveloped world and it is also contradictory politics because EU farmers are subsidized and their regulated markets.

A vote for the major UK parties in the May 2015 election is a vote that is silent about the benefits of fair-trade and your vote will indirectly lend support the EU’s contradictory liberal market experiments. The UK election is also about old politics and democratic participation when roughly one-third of the population fail to turn out to vote and now a hung parliament looks like a likely outcome (Source). Many of us do not trust the political rhetoric of party politics, possibly because it is not relevant and it’s often contradictory. An alternative politics could be informed by our choices and consumption and how this triggers changes in demand. The consumption and sale of fair-trade products has been increasing at a compound rate of 18 per cent in recent years (Source). Is this not a clear sign of civic engagement and trust that could be supported by our politicians?

If politics is to regain its relevance and motivate us to vote it is this type of evidence about the demand for fair-trade products that should be informing party manifestos. The issue of “Fair-Trade” would become increasingly visible and party manifestos might then reflect the needs of citizens boosting participation in the democratic process.

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