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Presentation On Free Trade & Fair Trade: Group: 7

The document presents a group project on free trade and fair trade. It discusses the differences between free trade and fair trade, including their definitions, key features, and products associated with fair trade. Arguments for fair trade include guaranteed minimum prices for farmers, improved working conditions, higher product quality, and stronger market positioning for small farmers. An argument against fair trade is that some companies take advantage of the fair trade label and only a small percentage of farmers directly benefit.

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Kien Dick
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75 views29 pages

Presentation On Free Trade & Fair Trade: Group: 7

The document presents a group project on free trade and fair trade. It discusses the differences between free trade and fair trade, including their definitions, key features, and products associated with fair trade. Arguments for fair trade include guaranteed minimum prices for farmers, improved working conditions, higher product quality, and stronger market positioning for small farmers. An argument against fair trade is that some companies take advantage of the fair trade label and only a small percentage of farmers directly benefit.

Uploaded by

Kien Dick
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Presentation on Free Trade &

Fair Trade
Group: 7
Đặng Văn Kiên

Phạm Quang Trúc

Nguyễn Đức Cường

Nguyễn Hồng Thọ

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5
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START
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Structure:
• Difference between Free Trade & Fair Trade
– An introduction to Free Trade & Fair Trade
– Difference between Free Trade & Fair Trade

• Arguments for & against Fair Trade


– Arguments for Fair Trade
– Argument against Fair Trade

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Free trade
 Definition of Free trade:

Free trade is a system of trade policy that allows traders


to act and or transact without interference from
government.

Under a free trade policy, prices are reflection of true


supply and demand, and are the sole determinant of
resource allocation.

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Free trade
 Features of Free trade:

• Trade of goods without taxes or other trade barriers

• Trade in services without taxes or other trade barriers

• The absence of "trade-distorting" policies

• Free access to markets

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Free trade
 Features of Free trade:

• Free access to market information

• Inability of firms to distort markets through government-


imposed monopoly or oligopoly power

• The free movement of labor between and within countries

• The free movement of capital between and within countries

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Fair trade

 Definition of Fair trade:

Fair Trade is a trading partnership, based on


dialogue, transparency and respect, that seeks
greater equity in international trade.

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Fair trade
 Feature of Fair trade:

• Contributing to sustainable development by offering better


trading conditions to producers and workers

• Securing the rights of producers

• Supporting producers

• Raising awareness

• Campaigning for changes in the rules and practice of conventional


international trade

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Fair trade products

• Chocolate
• Coffee
• Apples
• Bananas
• Oranges
• Lemons
• Limes
• Other fruit
• Nuts
• Tea
• Other drinks
• Meat
And many more items
Dimensions Free trade Fair trade
Profit is the overriding concern. Balances concerns for people, the planet
Strategy and profit.
Payment is received at time of Advance credit allows for income during
Financing shipment; credit is sometimes extended lean seasons between harvest/production
by informal lenders atexorbitant rates. cycles.
Corporate investment in a community Technical assistance and training build
can be limited to people and activities broader skill sets, and social premiums
Investmen
that build skills for use inrelated foster investment in social projects that
t commercial enterprises and/or generate benefit all residents of low-income
good publicity. communities.
Supply chain seeks out lowest-cost Disadvantaged groups are made partners
labor and raw materials, often through in the Fair Trade supply chain.
Supply
exploitative middlemen orcontractual
chains arrangements that reflect little concern
for producers and their families.
Marketing is directed at increasing Marketing is driven by consumer education
Marketing profitability and advocacy that leads to socially
responsible business innovations.

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An argument for fair trade
 Fair trade is about fair
or sustainable prices

• Fair trade guarantees a


floor price
• Fair trade helps farmers’
livings improved with
higher incomes
• Government agencies
always a good price for
farmers

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 Fair trade helps working
condition better

• When creating higher


profit, farmers will
reinvest in production and
improving working
condition.

• This is a big advantage of


fair trade, particularly in
developing countries

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 Products with higher
quality.

• Fair trade gives farmers


opportunity to improve
product’s quality due to
modern technology and
information.

• To exist in competitive
market as now, farmers
try more to make products
with higher quality.

• Bad quality is easy to be


pulled out of market

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 Small farmers have a
stronger position in world
markets.

• Chance for farmer to enter


in international market and
guarantees a floor price

• Farmers are easy to access


with intermediaries and
customers.
• Thus, they affirm their
position in market.

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 Fair trade encourages
smallholder farmers in
cooperatives.

• got farmers works in


cooperatives and help
themselves out of poverty

• also creates jobs,


improves livelihoods,
provides access to
financial services and
builds strong communities

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 Fair trade brings benefits
for consumers.

• Consumers in fair trade can


get many benefits.
• They use products with
high quality and competitive
price.

 Fair trade is the movement


of business today. Fair
trade is affecting
developing countries
positively.

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Arguement against Fair trade

• Some big companies take advantage of the Fair-trade mark.

• It only benefits a small % of farmers who benefit from higher


prices. Other farmers will be worse off.

• The majority of farmers who benefit are in Mexico a relatively


developed country. Only small parts of the poorest African
countries are included.

• Fair trade may distort market signals.

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According to the Adam Smith Institute:

• Just 10% of the fair trade premium actually goes to the


produce.

• Fair trade helps landowners as opposed to agricultural


labourers.

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Thanks for your attention

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