Trade is the buying and selling of goods and services.
Trade between various countries of the world has taken place for hundreds of years. Originally, trade enabled people to obtain food and materials that they could not produce for themselves. For example, the UK does not have a climate suitable for growing bananas, and therefore needs to import these from abroad.
The problem with trade is that it’s not always fair.
Often wealthy countries (like the UK, USA and many places in Western Europe) trade with less developed countries (like as Africa, South America and Asia). In many cases trade between the north and south is unfair because the amount that the people in the south (the producers of goods) are paid is much less than the amount their products are sold for.
Trade rules: Make Poverty History
Trade rules control how countries do business with each other. They are agreed at international level, and are supposed to make sure nations compete openly and fairly. The two main global trade organisations are the World Trade Organisation (WTO) and the International Monetary Fund (IMF).
The World Trade Organization is a global international organisation dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and ratified by the bulk of the world's trading nations. The goal is to help producers of goods and services, exporters and importers conduct their business.
The International Monetary Fund works to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty.
Whether these organisations have helped the world’s poor is a matter of debate and concern. According to the Make Poverty History campaign ‘the WTO promotes 'free trade' - getting rid of regulations that restrict big business or the free flow of goods. Free trade does not automatically lead to poverty eradication or environmental sustainability. In fact, it can increase poverty and be harmful to countries at different stages of development.’
That's because the rules are rigged - loaded in favour of the wealthiest countries and their business interests. Click to explore -through animations -unfair international trade rules So no matter how hard people work in the developing world, or how much their countries produce, trade relationships benefit the rich world most.
The result is misery for hundreds of millions of people who just want the chance to make a living, feed themselves, send their kids to school and create a better future for the next generation.
The Trade Justice Movement
The Trade Justice Movement in the UK was the first formal coalition of groups to use the term "trade justice" (partly because in the UK, "fair trade" usually refers to Fairtrade certification and is a consumer model of change rather than an overtly political movement calling for government action).
The mostly widely referred to demand of trade justice campaigners is access to the markets of developed countries or rich countries. When developing countries export to developed country markets, they often face tariff barriers that can be as much as four times higher than those encountered by developed countries. Poverty claims that those barriers cost poor countries $100 billion a year - twice as much as they receive in aid.Rich countries bully poor countries into accepting unfair trade rules at a multilateral or bilateral level. This impacts on the fight to win global justice for people and the planet.
Click here to take action with the Trade Justice Movement.
Click here to visit Christian Aids Trade Justice Campaign
“I’d like to tell people the coffee they’re enjoying now is the cause of all our problems. We grow it with our sweat and sell it for nothing.”
Lawrence Seguya, a coffee farmer
So what is your trade footprint?
Put simply, this is the amount of goods and services you use and consume that have been traded (bought and transported from other countries). The size of your trade footprint is affected by the amount of land, resources, water and energy involved in manufacturing or transporting traded items.
How far does your trade footprint reach today?
Try to measure your trade footprint! Look at the clothes you wear, the toys and games you play with, the food and drink you consume in one day: Where do they come from? How far have they travelled? How did they travel to you? What resources were used to make them and transport them to you? You may be surprised to see just how connected you are to the world through trade! And just how BIG your trade footprint is!
The trade footprint: how it measures up
- International trade is worth $10 million a minute. But poor countries only receive $40,000 or 0.4% of this trade.
- Rich countries spend $320bn each year on subsidising agriculture - six times the amount they spend on foreign aid.
- The average European cow is subsidised by around $800. Ethiopia's total national income per person, per year is around $100.
- If a jar of coffee purchased in a supermarket costs £3, just 3pence (1%) goes to the coffee grower
- If Africa, East Asia, South Asia, and Latin America were each to increase their share of world exports by just one per cent, the resulting increase in income could lift 128 million people out of poverty.
Trade and its effects on human rights
Unfair trade rules can have a dramatic effect on whether the rights enshrined under the United Nations Convention on the Rights of the Child are met. For example:
Article 28 states that children have a right to an education. But too often, because trade rules prevent producers in poor countries earning sufficient income, children have to work to support their families. This in turn prevents them from attending school. Fair trade on the other hand can ensure that rights are met.
Article 32 states that the government should protect you from work that is dangerous or might harm your health or education. Fair trade regulations prevent children from undertaking work and the social premium is often used to provide schools and education facilities.
For further information on the Convention on the Rights of the Childclick here
Millennium Development Goals
The eight Millennium Development Goals (MDGs) were agreed at the United Nations Millennium Summit in September 2000 and nearly 190 countries have signed up to them.
The goals are international targets for reducing global poverty. They aim to lift around 500 million people out of poverty by the year 2015. If this happens, fewer women will die in childbirth, fewer people will die from treatable diseases, many more boys and girls will go to school and the lives of millions of people will improve dramatically.
The eighth Millennium Development Goal includes plans to achieve a fairer trading and financial system. The goal includes a call to reduce tariffs and subsidies that make it difficult for poor countries to compete in the global economy.
For more information on the Millennium Development Goals click here
- Fairtrade Foundation Real life stories of producers and their families in developing countries and how fair trade has benefited them.
- Milking it! Two case studies looking at two dairy farmers – one in Wales, the other in Jamaica and the impact of subsidies. The case studies are interactive and involve you thinking about trade issues.
- Together TV – video stories on YouTube about people in the developing world living with the effects of unfair trade rules.