WTO failure aids farmers|
Trade talks' collapse a plus in poor nations
Susan Ferriss - Cox International Correspondent
Tuesday, September 16, 2003
Mexico --- Within hours after the surprise collapse of World Trade Organization
talks Sunday, members of the U.S. trade delegation were jetting home in defeat.
At the other end of the power spectrum, it was a victory.
Small Latin American coffee farmers, African cocoa producers and others
rejoiced in the failure to reach a new agreement to eliminate trade protections
and open countries to more corporate investment.
They also were able to use the meetings of the powerful 148-member organization
as a showcase for modest but growing efforts to make global trade fairer
for developing countries' farmers, who are on the lowest rungs of the international
A few miles from the convention center where WTO delegates met, fair trade
enthusiasts gathered to show off coffee, chocolate, tequila, Nepalese jewelry
and Panamanian and Peruvian woven clothes whose profits go more directly
to producers rather than middlemen.
International aid and development groups, like Oxfam, are worried that
the globalization of trade is creating a ''race to the bottom'' that is driving
down prices for commodities like coffee and chocolate and making farmers
in poor countries vulnerable to greater exploitation.
To combat this, a global network called Fair Trade Labeling Organizations
International has established a way to certify that products are produced
without labor abuses and with prices that are higher because of their quality
or because they are organic.
The push is on to get more products with fair trade labels in retail stores
as diverse as Whole Foods and Trader Joe's to Safeway, Starbucks and Dunkin'
The U.S. donut chain, which includes 3,500 franchises, announced this year
that its new espresso drinks would use 100 percent ''fair trade'' coffee
beans, a decision that Oxfam praised.
''Fair trade makes a big difference to us. With fair trade sales, we've
been able to get villages potable water, sanitation facilities and more money
to invest in other economic activities,'' said Appiah-Kubi Abraham, who was
in Cancun to promote the Kuapa Kokoo cocoa bean cooperative, which unites
40,000 farmers in Ghana.
The farmers in Ghana earn only about $400 a year from their cocoa, but
set aside some of their surplus to invest in infrastructure, such as a public
well, or projects to develop new sources of income and reduce their dependency
The Kuapa Kokoo cooperative also owns 33 percent of the Day Chocolate Co.,
which sells Divine and Dubble chocolates, products that bear fair trade labels
and are distributed in the United States and Britain.
The Washington-based Fair Trade Federation, which helped host the exhibit
here, estimates that commerce that met fair trade standards surpassed $400
million last year, translating into an extra $30 million for producers in
about 40 countries. While still small, it represents a 44 percent jump in
such trade over last year.
Sales of fair trade coffee increased in the United States by an estimated
46 percent between 2001 and 2002. In Europe, where the concept is popular,
overall fair trade sales increased by more than 100 percent in Austria, France
and Norway during the same period.
''Fair trade is the only thing that is allowing me to support my family,
to make sure they can have education and health care,'' said Daniel Chinchilla,
43, a Honduran coffee farmer in Cancun with the 10,000-member Honduran Coffee
Cooperatives Central Union.
Because of a flood of coffee on the global market and the dismantling of
international agreements that controlled its prices and supply, coffee farmers
have been devastated by plunging prices for their beans even as retail prices
An estimated 25 million coffee farmers in Latin America, Asia and Africa
have seen prices drop by as much as 70 percent in five years, according to
The crisis has been so terrible, Chinchilla said, that he and other farmers
haven't been able to buy fertilizers and other chemicals typically used on
coffee bushes. But, he said, his inability to buy chemicals has helped him
convert some of his fields to organic coffee, a process that requires several
years of purifying the soil.
Chinchilla says he's successfully converted some of his crop to organic
beans and is receiving a fair trade price guaranteed at almost double the
conventional coffee price. His coffee beans end up mostly in the Netherlands,
Norway and Denmark.
The farmer is grateful to the fair trade movement. But he doesn't see the
World Trade Organization, whose aim is to reduce tariffs and boost investment
worldwide, as a positive influence over the lives of peasant farmers like
''World commerce is basically in favor of the big multinationals,'' Chinchilla
said. ''There is an injustice in the price of coffee. We see that every day
coffee is sold for more and more, while what we producers earn is nothing.''