I agree with the argument put across that fair-trade is an emerging nice in the marking that has changed the way producers and other business persons conduct their activities. The fair-trade concept is based on the need to enhance the efficiency of the small scale producers and ensure that there can compete in both regionaland global markets. Nonetheless, it has been the subject of many critiques with numerousdebates emerging on itsefficiencylevels. Despite the fair-trade eliciting aheated debate, there exist scant literature review or materials on its role in an economy.

It is thus vital to analyse the differences between the regular market and the fair-trade market.  It is worth citing that fair-trade is based on the need to increase the income levels of the producers. There have been critiques that the process only involves the producers but sideline the workers.  In many developing countries, the institutionalarrangement has allowed the producers to access better production methods and a large market for their products. Focusing on many developing countries indicates that they have poorly organized economic structures.

Rather than exporting finished products, many producers in developing countriesexport raw materials implying that they have lower earnings (Sylla, 2017). The case can be seen in the sale of agricultural products such as tea and coffee. From many years, farmers and producers have been subjected to low pay levels and other economic problems. Nonetheless, the introduction of fair-trade saw the formation of groups that allow theproducers to demand frombetter prices for theexports. Contrary to the previous settings, the merging of the producers means that they have high bargaining power and a say in major economicactivities.

On the other hand, there have been instances where the producersand workers in developing countries have been subjected to harsh working conditions. An example can be seen in the production of horticulturalproducts where there is the use of harmful chemicals. The weight of the process of the unethical productprocess often weighed heavily on the developing countries as opposed to the importers in the developed countries. However, fair trade has allowed for the creation of groups that stress the need for conformity to environmental laws. There is a focus on the production standards and the impacts they have on both the workers and the general society.

The objective of fair-trade is to ensure that there is an attainment of equality in global trade. For many years, countries such as India and Brazil have been the leading exporters of agricultural products to the USA, UK, and China. Despite their active role in global trade, they have not attained equal economic benefits as it is the case with other countries (Smith, 2013).  Through the offering of better trading conditions, the fair-tradeinitiative ensures that economic activities are geared towards the attainment of sustainableeconomic models. There is also the belief that protecting the interest of the producers will minimizeinstances of consumers’exploitation.

Currently, many of the ongoing global economicactivities are seen as contributing toenvironmental conservation. The improvement in the welfare of the producers implies that they will be in abetter position to take part in initiativesthat  seek to promote economic growth in their countries. Unlike the initials settings, am nay developing countries are emerging as major global players in the business.

The trends imply that the huge earnings by the producers are pushed to economic growth and the creation of employment and other initiatives. Focusing on countries such as Brazil indicates that trend has been instrumental in the redistribution of wealth. Better organization of the production process implies that there is a reduction of wastes while also ensuring that there is the optimal utilization of resources. The argument rest on the fact that cases of underfunding and low prices meant that the producers did not have access to better production methods.

However, the problem has been resolved and also has seen an expansion in the market size. Likewise, the organization of the producers implies that there is an improvedquality of the final goods. Many of the fair-trade arrangementsensurethat there is strict adherence to production standards (Dragusanu et al. 230). These standards are defined as being ebbingessential in the pushing of products in the global market. While the move allows for the generation of high consumer traffic, there is also the protection of the consumers’ rights.

From the listed information, it isevident that the new initiatives come with many benefits to the producers. Despite the critiques on the possible violation of workers’ rights, it is worth pointing out that they have led to the better organization of producers. It means that there is increased access to global markets and the producers are also in apposition to bargain for high prices. It can be defined as being an essential step in the attainment of global economicequality. The argument rests on the fact that it ensures that producers in developing countries are rightfully compensated for the products. Additionally, it also ensures that there are efforts to redistribute income at the global level.

Work Cited

Dragusanu, Raluca, Daniele Giovannucci, and Nathan Nunn.”The economics of fair trade.”Journal of economic perspectives 28.3 (2014): 217-36.

Smith, Alastair. “Fair trade and the economist’s critique’.”Open Economy 2013.28 Feb (2013).

Sylla, N.S. (2017). Fairtrade only really benefits supermarkets. A rethink is needed — the Guardian.

Retrieved November 14, 2018, from https://www.theguardian.com/commentisfree/2017/aug/04/fairtrade–benefits–supermarketsglobal–south–outdated–model

 
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