Why Fair Trade?
According to the U.N.:
- About 1.3 billion people live on $1 a day
- 2 billion people have no access to electricity
- More than 1 billion human beings do not have access to clean water
Poverty is a very serious, real issue for many people in this world. Fair Trade is a way to level the economic playing field and include more people in the global marketplace so they have opportunities to assert their social, political, and economic rights. Fair Trade is a holistic approach to trade that in the most simple sense gives workers the wage they deserve for their work, and sets standards for healthy, positive, and fair work environments.
In conventional trade, the producer generally receives only 1% of the retail price consumers pay but in Fair Trade the producer generally receives 20 – 40% of the retail price. A fair wage in the regional or local context in Fair Trade is one that has been agreed upon through dialogue and participation. A living wage enables artisans to cover basic needs like food, shelter, education, and health care for their family and to save for the future.
For PJT, this means that artisans (not PJT) determine the price at which they sell their handcrafts. This price includes a living wage, materials costs, as well as 5-10% profit so that the artisans’ businesses can invest in materials, equipment, etc. One might assume that paying the producer a fair wage would increase the cost to the consumer, but because Fair Trade is a direct relationship with the producer, it cuts out many of the profit-seeking intermediaries along the supply chain, and a justly produced product is delivered to the consumer at nearly the same cost as conventionally traded goods.