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Fairtrade Asia-Pacific, 2016


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Fairtrade Asia-Pacific, 2016

  1. 1. Network of Asia and Pacific Producers (NAPP) 3307, Lippo Centre, 89 Queensway, Hong Kong 273, Thomson Road, #04-01, Novena Gardens, Singapore- 307644
  2. 2. About Fairtrade The Fairtrade System Fairtrade in Asia Pacific © Fairtrade 2010
  3. 3. “Fairtrade is about sourcing in a responsible manner, being mindfulof the importance that farmers play in our global society. Put simply, it’s the right thing to do.” Jostein Solheim, CEO of Ben & Jerry’s So, what is Fairtrade about?
  4. 4. Vision: A world in which all producers can enjoy secure, sustainable livelihoods, fulfill their potential and decide on their future. Mission: Connect disadvantaged producers and consumers, promote fairer trading conditions and empower producers to combat poverty, strengthen their position and take more control over their lives. Fairtrade Vision, Mission and Status Quo
  5. 5. 1940s and 50s First fair trade initiatives in USA, then 60s /70s in Europe 1988 First ever Fairtrade label, Max Havelaar Early 1990s Various national Fairtrade organizations set up across Europe 1997 Fairtrade International (FLO) founded 2000s New member countries including AUSNZ, Spain, South Africa 2002 Introduction of the international FAIRTRADE Mark 2004 Founding of FLOCERT 2010 Common brand and identity 2012 New constitution – more representation for producers History The cause
  6. 6. Producer Trader Licensee Consumer Centralized Services FLOCERT Marketing Services Service Delivery Production Chain • Standards & Pricing • Financial Management • Policy Advocacy • Branding and Communications • Risk Management • Licensing • Promotion, branding • Consumer awareness • Sales targets • Consumer Impact Producer Services Underlying the product value / supply chain… …there is a ‘derivative’ Fairtrade Service value chain • Certification • Technical Support • Supply Chain linkage • Efficient sourcing • Producer Impact … …but there’s more ‘under the hood’ Bottom-line: Don’t worry!! Fairtrade is with you!
  7. 7. Producer networks have equal voting rights in Fairtrade’s highest decision- making body: The General Assembly Building producer empowerment Through a bottom-up representation of producers
  8. 8. How Fairtrade works • Fairtrade Standards • FAIRTRADE Certification Mark • The Brand and Impact: Consumers to Producers • Sales and successful markets • Fairtrade and Fair Trade
  9. 9. Fairtrade Standards  Fairtrade Minimum Price: Price floor insures producers if market prices fall  Fairtrade Premium: Collective ownership. Above the purchase price to invest in community based projects, needs or businesses  Democratic decision-making at the producer level (including utilization of the premium)  Long-term, stable contracts with buyers  Adherence to core International Labour Organization conventions  Core and development criteria – producers mapping their own development  Climate Change Adaptation and restrictive chemical use Fairtrade Standards And the triple bottom-line development
  10. 10. Producers and traders have met the Fairtrade Standards Supported by an independent, transparent and globally-consistent certification system auditor ISO 65 accredited FLOCERT Standards and more details at The FAIRTRADE Certification Mark …The brand stands for something…
  11. 11. © Anette C. Kay Fairtrade Standards for around 300 products Brand to Impact Consumers to Producers
  12. 12. €0.8 €1.1 €1.6 €2.4 €2.9 €3.4 €4.3 €4.9 €4.8 €5.5 0 1 2 3 4 5 6 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Estimated sales in billions of euros ~€6 Fairtrade Sales Gross Merchandise Value (GMV) 2015  Value of Fairtrade Sales at Point of Sales (consumer)  Income at the ‘derivative’ Fairtrade Service value chain collected as % License Income comes to Fairtrade marketing Organizations, derivative channel:  A very small percentage of that is currently applied to ‘producer support’ and on- ground impact development. There is scope and potential for more investments
  13. 13. Fairtrade Sales Brands & business partners
  14. 14. More than 1,300 Fairtrade Towns in over 20 countries Over 900 Fairtrade schools in the UK alone Fair(er) Trade Campaigns and partners
  15. 15. Fair Trade And Fairtrade Fairtrade • Describes the certification and labelling system governed by Fairtrade International. • Products carry the FAIRTRADE Mark • Round “Brand Mark” for corporate identity use Fair Trade • Refers to the Fair Trade movement as a whole and organizations that abide by the high principles of Fair Trade. • Includes labelled and unlabelled goods and the work of Alternative Trade Organizations, Fair Trade federations and other networks • Fair Trade is not necessarily Fairtrade but Fairtrade is Fair Trade
  16. 16. But Fairtrade is not perfect …And we recognise that…  Conceptually, social and economic development through responsible business is undeniably, a great idea!!  Challenges: Idea to implementation  How to use Standards & Certification as a “Tool” for development?  Circular vs linear process of standards – Fairtrade is different  Combination of proactive and response driven. Knowing what works what doesn’t…  Managing the balance between business acumen and activism  Not a niche/ upstairs market but mainstreaming is a roadmap. vs mission drift  Multi-stakeholder democracy – Speed, accuracy and bringing everyone along.  In Asia-Pacific, we’re open to collaborations on Fair Trade, thematic interventions, localized projects and creating deeper impact …is a constantly learning and evolving system… …prescriptive to being practical... ….creating a systemic ‘mind-shift’… ….leading to a gradual ‘paradigm-shift’…
  17. 17. Focus and priorities over the next five years: • The implementation will demonstrate our contribution to the Sustainable Development Goals and re-affirm our position as a leader and innovator in ethical trade • Respond to the need to secure living wages for workers and living income for farmers through changes in pricing, purchasing practices and trading relationships will be the central theme of all our work • Show how Fairtrade values, applied through tailored support for inclusive organisations, intervention in pricing to ensure fairness, and building access to Fairtrade markets delivers positive outcomes for farmers and workers Building benefits for smallholders & workers Deepening impact through programmes & services Building Fairtrade Markets Provide inputs on Government Policies Building a Strong, Settled Global System 2016-2020 Strategy Building on the strategic vision
  18. 18. Civil Society (on-ground implementation) , Media, Promotion Corporate and Consumers Govt., Statutory bodies, Industry Associatio ns etc. 2016-2020 Strategy Creating a better ecosystem by partnership Building benefits for smallholders & workers Deepening impact through programmes & services Building Fairtrade Markets Provide inputs on Government Policies Building a Strong, Settled Global System We will work with the government / quasi-government agencies to create impact for small and marginal farmers
  19. 19. Agenda The Fairtrade System Fairtrade in Asia Pacific © Fairtrade 2010
  20. 20. Highlights Our Customers Fairtrade in Asia Pacific Region  Legally set up in Feb 2014 in Hong Kong and March 2015 in Singapore Operations:  18 countries | 187 producer organizations | Growth: flat (1%) y-o-y  163,700 farmers & 104,000 workers | Growth of 3% from last year  Nascent. Small in a larger global setup  Represent 16% of the total (Fairtrade farmers & workers)  11% of the total Fairtrade farmers  51% of the total FT workers  Gender balance  Among farmers in SPOs, 12% are women behind the global average: 23%  Among workers in plantations, 55% are women ahead of the global average: 48%  Landholding: 1.5 hectares (Average) 20
  21. 21. Highlights Our Support  On site: In 2014, ~85% of certified producer organizations in Asia and Pacific received training support and from Fairtrade  International Exposure:  In 2015, 56% of producer organization representatives participated in 7 international and external events, 16% of whom were women  46% of the producer organizations participated in various workshops and trainings represented by 306 participants, 8% of whom were women  Training topics included Internal Control Systems, managing the Fairtrade Premium, prevention of child labour, disaster prevention, Standards compliance and adaptation to climate change.  105 Producer Organizations received training in market access, productivity or product quality 21
  22. 22. 22 Market Linkage Premium Receipts 2015 MEL ANALYSIS
  23. 23. Fairtrade Premium Distribution By Products (2014) • Coffee still forms the highest share of the Fairtrade premium revenues: Share 45% in 2012-2013; 41% in 2013-2014 [2015 numbers are being calc] • Cane sugar & tea are stable at 23% and 21% respectively. • Fairtrade cotton saw a slight increase in Fairtrade premium revenues from 5% to 8% 23
  24. 24. Fairtrade Premium Usage Monitored, Evaluated and Audited 24  Under ‘Services to communities’  7% on education  6% on health services &  2% on community infrastructure  Under ‘Services to farmer members’  9% on provision of agricultural tools  6% on farm best practices  5% as payment to members  3% on agricultural training  Under ‘investment in producer organizations’  25% on HR & administration of the PO;  21% on creating facilities and infrastructure 47.81% 1.78% 21.21% 29.20% Investment in producer organizations Other Services to communities Services to farmer members
  25. 25. 25 @ VIETNAM  Coffee  Cocoa  Nuts  Fresh fruit  Tea  Herbs  Herbal teas & spices Products and Potential Products 300+ to choose from | Coffee, Cocoa Core Products
  26. 26. Raising Incomes and Improving Lives Case Studies from India, Sri Lanka 26 From worker to supervisor “It is because of Fairtrade that I have the opportunity to sit together with the management and workers at various forums to discuss our issues and how Fairtrade Premium should be utilized as an equal. Everything is decided democratically and gives us a voice.” Lalita Inbarani, Sri Lanka, bio tea of Stassen estate
  27. 27. Raising Incomes and Improving Lives Case Studies from Indonesia DREAMING BIG: one of the first all-women coffee cooperatives in Indonesia Being part of the cooperative Koperasi Kopi Wanita Gayo has improved the women’s quality of life. Previously, the women knew neither about coffee roasting nor how to improve cultivation. Only their husbands had received this training. Now the women, too, are learning new skills. In fact, the first Fairtrade Premium was spent on training to increase soil fertility and learn cupping skills. The women also plan to create a health centre catering for women’s and reproductive health, but also focusing on Ear Nose and Throat and abdominal problems. 27 “My aspiration is that I want to prove that we can achieve busness success with our will and determination. I want our cooperative to become internationally recognized and perform even better than our husbands’ cooperatives.” Passionate words of Yuyun Sri Wahyuni. Rizkani Ahmad, chair is only positive about recent developments. “The women in our community feel closer and we now have a channel to express our interests, experiences and plans,” she says. “The women say to me, ‘We may not have much education but we have big dreams’.”
  28. 28. Positive impact seen in virtually every set-up  Many studies show that household income has increased  This extra income meant more savings, purchase of household assets, diversification of income sources and a change in mind-set regarding longer term investments  Income effects were mostly due to Fairtrade Minimum Price. Fairtrade Premium also played a crucial role in enhancing incomes via improved productivity, quality and/or reduced costs However, there are still some key challenges:  Income growth was found to not always be sustainable across the years. The differences in income at household level are sometimes relatively small  Fairtrade’s impact was seen as more important in stabilising incomes (than in boosting them) Also, for farmers with lower yields it was more difficult to cover the high costs of production 28 Raising Incomes and Improving Lives Learning from Research
  29. 29. Top countries by Percentage Share of Fairtrade Premium Vietnam is at #4 29