Globalization of goods /services and fair trade has helped in providing developing countries with more output of products, selling and producing techniques that are more ethical, open future investments through funding and technology. While some have benefited, others have lost jobs and resources. Coffee the second valuable traded commodity in the markets, has needed help in this industry with fair trade. These farmers crops usually grown in remote areas, have no access to credit , are indigent and in need of funding and technology. “A labor-intensive crop, coffee grows well on small and steeply slope parcels of land. Small scale producers often with landholding smaller than 3 hectares, constitute the majority of coffee producers in the country and are concentrated in some of the poorest regions.” Case Studies...(2009). The reasons these farmers do not profit well in the markets today, because they have lost their place as the foreign exchange earner allowing other competitors like Vietnam, Cost Rico, Ethiopia, India ,Tanzania and Uganda to emerge. “When the collapse of the ...
This reality is a reflection of the inequality in income distribution in the production and marketing of cocoa-based products, where 70% of the final price of the product is received by transnational companies and the industry, while producers receive only 5% of final prices. This often does not even get the farmers to cover the costs of production. Additionally this means that the market structure leaves producers with little ability to make decisions and unlikely to actively participate in the definition of international economic rules. For this reason they are forced to produce at low cost, which affects the working conditions of farmers.
Because larger scale plantations are able to sell a cheaper product it makes it almost impossible for small family farms to compete without cutting down net profits (Nelson & Galvez, 2000). In order for cocoa farmers in impoverished countries to increase national wealth they need to increase their productivity. Wealth in countries is directly correlated with the nations productivity, and in largely cocoa based nations efficiency in cocoa farms are very important. Wealth allows farmers a greater amount of leisure time to invest in education, health care, and capital equipment. While companies, like fair-trade, help provide farmers with health and fair crop prices to increase national wealth farmers have to increase productivity and increase capital investments (Nelson & Galvez, 2000). Educated citizens can advance nations to achieving a more economic and better developed society, which in return will change a vicious cycle into a virtuous one creating a more sustainable
Although Fair trade has been presented as a solution to the exploitation of coffee laborers, it isn’t a perfect solution. Though, it is clear that its advantages outweigh its disadvantages when the suffering of the other farmers is seen. Even after those laborers were freed of slavery, they weren’t exactly treated much differently. If this is what is happening to the laborers of this commodity, what is happening to those forced to work in the industry of sugar, petroleum, tea, etc?
As discussed in class, when demand decreases for a product, companies or in this case producers should exit the market. But when it comes to coffee, producers don’t want to exit the market because the costs of moving out of coffee production are quiet large and farmers don’t have the means for alternatives. The reason being that, farmers don’t have any outside funding to promote efficient diversification and development. Another reason is that there are protection policies from the United States and the European Union that have made it harder for framers to benefit from producing other crops. And yet, the opportunity cost for farmers to switch to another product is higher than the cost of coffee in a low profit market. So, this book discusses different strategies that are being used to help producers get a better advantage to provide a living for their families. Different strategies being used include shade-grown coffee, differentiation of products, organic coffe...
In places like Africa and Brazil where they grow cocoa beans the economy is very unstable and without the help of fair trade the farms don't get enough money to sustain them self. Such as the average age for cocoa farming is 45-50 and more and more people are looking for other jobs because the
...-operative handling distribution of coffee (Kolk 2013:327-28). Fair trade also allows consumers to consider the type of product being purchased by informing them of the fair and ethical practices behind the coffee beans (Kolk 2013:334). By supporting fair trade coffee the consumer can feel a sense of contribution in supporting the farmers’ livelihood.
The Protagonist of the film, Mr. Tadesse Meskela has devoted himself entire to the task of travelling around the world looking for buyers who will pay a fair price for the best coffee of the world, from Ethiopia no less. He looks to give his farmers a decent living wage, a sustainable life. Many communities don’t have the bare minimum requirements that we take for granted like clean water or
Coffee is a growing part of people’s daily lives. Just before the 9-5 weekdays, and even during the 9-5, it is common for the working class to drink a cup of coffee. To support this accustomed part of our culture, it involves a complex supply chain that allows those coffee beans to turn into a cup that can be consumed. This paper is structured on how Starbucks, the top coffee supplier in the world, can supply its stores, from raw materials to manufacturing, right to the start of someone’s day.
The Washington Post article was about Columbian coffee. The people in Columbia have just in recent years tasted good Columbian coffee. The main reason for that is the best arabica coffee beans in Columbia were being exported leaving citizens bad, cheap imported coffee. Because of globalization and foreign investors the domestic coffee is becoming better. There are columbian people that have traveled and has had the opportunity to taste quality Columbian coffee. When these people come back to Columbia they are giving the people better coffee and coffee that they can afford. There has also been a spike in the number of cafes in Columbia. Another reason for the rise of quality coffee is the end of the war with the left-wing FARC guerrillas.
I drink coffee almost every morning, yet I have never thought about the coffee industry or the process involved with the coffee trade. What I am aware of is that the coffee production is usually revolved around Africa and North America, which are destinations that are not as economically developed as New Zealand. In terms of fair trade coffee, I have never considered using it, as I did not know that there was such a system. I only purchase coffee depending on the brand; the taste would be assured, as it is popular with the majority. I also look for cheap prices and products that are on special. Even if the coffee product I purchase is fair trade, I would have only bought it because it is on special or popular with the mass.
The movement particularly emphasizes on exports from developing countries to developed countries, with products such as handicrafts, coffee, cocoa, sugar, tea, bananas, honey, cotton, wine, fresh fruit, chocolate, flowers and gold. Moreover, coffee is one of the most widely traded goods in the world. For many developing countries, coffee trade is an important source of income. Producers can provide a better trading and improve terms of trade. Moreover, this allows producers to improve workers’ living environment and future life in general (De Pelsmacker, Driessen and Rayp, 2005).
Moreover, international trade can be more effective in reducing poverty than outright aid in which trade can help any country become self-sufficient, rather than relying on foreign assistance. However, there are, many disparities within the present global trade system that work against poor countries. That is regulated by a set of rules created by governments over the years. In general, poor countries don't have access to developed countries’ markets because of the barriers of trade and agricultural. It’s difficult for poor countries, because of trade barriers, to sell their products abroad and develop their living conditions. While free trade benefits everyone, governments sometimes aim to protect their goods and markets by providing subsidies to local rules and producers, or creating barriers like tariffs and quotas. This particular practice is known as Protectionism; which can be identified as the economic policies and procedures of controlling trade between states...
When comes to Economic aspect, coffee is the second most traded product in the world after petroleum. As the country’s economy is dependent on agriculture, which accounts for about 45 percent of the GDP, 90 percent of exports and 80 percent of total employment, coffee is one of the most important commodities to the Ethiopian economy. It has always been the country’s most important cash crop and largest export commodity. (Zelalem Tesera p
...earch and extension, rural infrastructure, and market access for small farmers. Rural investments have been sorely neglected in recent decades, and now is the time to reverse this trend. Farmers in many developing countries are operating in an environment of inadequate infrastructure like roads, electricity, and communications; poor soils; lack of storage and processing capacity; and little or no access to agricultural technologies that could increase their profits and improve their livelihoods. Recent unrest over food prices in a number of countries may tempt policymakers to put the interests of urban consumers over those of rural people, including farmers, but this approach would be shortsighted and counterproductive. Given the scale of investment needed, aid donors should also expand development assistance to agriculture, rural services, and science and technology.
Agriculture holds a significant role in underdeveloped countries. It is often the backbone of their economic and social well-being. It acts as the main source of employment and income, 70% of a country's population rely on framing as a mean of living (CITE HERE). Because most underdeveloped countries have low rates of educational attainment, farming is a popular source of employment. It requires little to no education. As a result agriculture employs many people contributing to nations economic development. Residents can also sell what they grow, providing them with a source of income, thus not only raising the national income level but the standard of living as well. Agriculture is not only a ...