5th November 2010

What is it with the IEA and Fairtrade?

Yesterday's report and press release from the free market think tank, the Institute of Economic Affairs (IEA), is not the first time they have made anti-Fairtrade noises.

Over several years they have criticised Fairtrade on the basis of its claims and seem to view the large proportion of the population who 'get' Fairtrade as deluded.

Yet, they still fail to understand quite what Fairtrade is. It seems that the IEA views Fairtrade as a type of charity, giving a little bit more money here and there to poor people, while the giver needs to be assured at every step that the money is spent wisely.

For anyone who has met Fairtrade producers, we know it is about so much more than just the money. It's about transforming the trading relationship between consumers and producers.

One of the latest criticisms levelled at Fairtrade by the IEA is that "Fairtrade products can squeeze out from the market other socially labelled products". Surely a bizarre statement from a free market think tank! If Fairtrade products are proving more popular with consumers in our 'free' market in the UK then surely this is what is supposed to happen. No-one is forcing people to buy Fairtrade.

Unfortunately the IEA remain short of solutions for poverty in developing countries. While repeating the manta that free trade is the answer, not Fairtrade (aka charity in their eyes), they fail to acknowledge that the market is anything but free when poorer countries try to trade with us.

When the IEA starts a more vocal campaign to lift trade barriers which harm the poorest, I'll start to take them more seriously.

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