A recent study conducted by researchers at the University of Göttingen has found that Fairtrade products do not benefit the entire supply chain, as the extra income is mostly kept by the farmers. Due to a lack of control measures, poor rural workers do not receive higher wages despite the fairness claim. The study focused on cocoa cooperatives in Ivory Coast, the world’s largest cocoa producer. Previous studies on the impact of Fairtrade systems had only considered the situation of farmers, but a significant portion of cocoa production is carried out by land workers. The study found that while Fairtrade certification did increase the wages of cooperative members, it did not improve the situation of their land workers.
The study analyzed data from 50 cooperatives involving 1,000 individual farmers who employ a large number of land workers. The results showed that “the wages of cooperative members increase through Fairtrade certification.” However, the traditional payment methods of small farmers allowed them to keep the wages of land workers low, rather than distributing the extra income as intended. Additionally, the lack of control measures meant that Fairtrade promises could not be enforced, and compliance was left to the farmers’ discretion. The researchers concluded that the assumption that Fairtrade products benefit all participants in the supply chain is a misconception, and better solutions are needed to ensure that all parties benefit from the additional income.
The Ivory Coast is one of the poorest countries in the world, with a nominal GDP per capita of only $1,459 in 2016. The country has been criticized for using child labor on cocoa plantations, with reports of up to 12,000 children being employed as slave laborers in 2010. While Fairtrade certification may help small farmers escape poverty, it does not address the issue of poor working conditions for land workers. The study highlights the need for better solutions to ensure that all participants in the supply chain benefit from Fairtrade products.
