"Is Fair Trade Really Fair?"

Research and original content by "JustJames" James Carmichael, 
edited by Rie (General Manager, Tealet)
               In 2013, Steepster.com member James Carmichael was assigned a project in a Human Geography class. He had to focus on a sub-Saharan country, for an issue he was passionate about. He had the idea to study Ugandan tea.
Uganda Tea Facts (2012)
Tea fetches an estimated 3.4 billion in revenue
13th largest tea manufacturer in the world
Tea production employs 62,000 individuals directly
Supports an estimated 500,000 dependents
If tea was so big in Uganda, why could James find only one vendor for Ugandan tea in all of Ontario? Instead, what he did find was African Fairtrade stamped tea. The Fairtrade stamp seemed to be everywhere...


Map of Uganda, in East Africa
The blue flags denote tea farms.

What is Fairtrade? 
 "Fair trade" is the term for the range of sustainable practices. It is not the same as "Fairtrade", which is the Fairtrade International brand and mark.
Because there was so much African Fairtrade tea, James hoped to get insight from them for the project, and made a call to the Toronto headquarters. The first call went very well, and James was amazed and excited by what they explained:
(1) that farmers invested the Fairtrade premium democratically (to build roads, dig wells)
(2) that Fairtrade farms had a much lower occurrence of malaria because of the new wells
(3) that Fairtrade International believed in full transparency.
Still, he had to find out more to complete his project. For example, how did Fairtrade affect Uganda in particular? He also wanted to pass on questions from the online tea community...
Fairtrade International mark.




James conducted a survey in the Steepster forums. He found was that in general, the more a person knew about tea and the tea industry, the less they favored Fairtrade tea. People liked the idea, but they needed information and assurance.

  • Are the farmers paid fairly for their tea?
  • How much did the farmers have to pay to get certified?
  • Do they pay inspection fees?
  • Or is it a marketing ploy?

Instead, they favored buying directly from the tea grower, or from small merchants with strong relationships to the growers.

James, aka JustJames,
on the tea community Steepster



James tried to contact Fairtrade again many times. His contact in Toronto had gone on vacation, but never called back. He left voice messages with his new questions, and even contacted the London and Berlin headquarters. No response. The company seemed to be avoiding him. But he had already finalized his thesis, "The Effects of Fairtrade International on Tea Farmers in Uganda", so he would have to keep researching...



Marketing of Fairtrade
James found that Fairtrade International is not a charity. In 2011, it had $6.9 billion in revenue, and it also acts as an independent microfinancier, with loans of $60 million. James could not find the online reports for their finances.
James asked people at the tea aisle at The Market, an upscale grocery in BC, what they thought. Many people were surprised to learn that Fairtrade was not a charity. He found that people don't have a problem with the big business/capitalism - what they didn't like was subterfuge, or misleading information...
Fairtrade International infographic, with 
"17 countries = 11.5%" added by James

For example, what does the infographic really say? The human brain is genetically cued to be most attracted to the bright GREEN statements. Subtly, the ad makes you drawn to the green "9 in 10" statement = 90%. However, if you look closer:

"Nearly 6 in 10 consumers have seen the Fairtrade mark..."
= less than, but almost 60% of the surveyed consumers have seen the Fairtrade mark
"And of those, 9 in 10 trust it."
= 90% of 60%, which is 54%.
Actual conclusion: 54% of polled consumers in 17 countries
This use of language that deliberately disguises/distorts meaning is called "doublespeak", or "spin." It is a commonly-used tactic for big business. Because the statements are so general and ambiguous, people are not prompted to disagree.
Fairtrade's marketing also works because it appeals to people's altruism. People like to help other people - it yields a helper's high, an endorphin rush that is good for human health. It is what makes people empathetic, generous, and understanding.
The problem is the potential versus the reality. With $6.9 billion in revenue each year, Fairtrade could potentially be changing the world, but where are the in-depth financials to back it up?
After months of research through multiple angles, James could not find the answers to his questions about Ugandan tea farmers, and Fairtrade. Instead, he did learn about what the tea industry thought about Fairtrade, and what consumers valued. The average consumer is willing to change their buying patterns, but they expect a conversation. They want a reason why. What they don't want is to be lied to by an organization under the guise of doing good work, and they want what is fair for the farmers. 
Fairtrade's campaigns are simple, empowering, and make you feel good, but they don't rock the boat or make challenging statements, which makes it easy to spend money without thinking too much, or asking too many questions.
The situation with fair trade is not black and white, and it becomes more unclear as more information is obtained. For a company that claims transparency, they are so secretive - they have recently declared that they will not open their account books for public assessment. The EU is also trying to lay charges against Fairtrade International for violating Unfair Commercial Practices directive. Hopefully, problems can be solved in the future through more study.
James Carmichael
This was a condensed version of James' original project, "Is Fair Trade Really Fair?",
and was edited then published here after his approval and review. Thank you for sharing your project, James!