Global Village: Promoting Fair Trade

by Tim Young

From SIF SATELLITE issue 45, Fall 1996

Africa map
Recently there has been a movement in the U.S. to "buy American". The purpose of this is to support workers in America rather than a foreign country. But there is an entirely different angle to this: in many cases, buying foreignmade goods does the foreign workers no favor.

Take clothes, for example. On a recent trip to the clothing store at the air base where I work, I looked at the labels of men's shirts. All the shirts I looked at were made in such places as Hong Kong, Pakistan, Singapore, or China. Made by foreign companies? No, Levi's is about as American as you can get.

Why do corporations in industrialized countries export jobs? Because the labor in other, less developed countries is cheaper. In fact, it's often questionable whether the workers in those countries are getting paid a wage comparable to the value of the products they make.

This is even truer in less industrialized countries, like those in Africa. Many people grow crops or make other products for pennies a day, selling their work to companies who make large profits reselling the products in industrialized countries.

This is why there are fair trade groups such as Global Village, an organization based in Tokyo and headed by Safia Minney. According to a Global Village brochure, such groups "often run integrated development programmes that encourage environmental protection," as well as giving producers in developing countries an outlet to sell their goods at a reasonable price. "By paying people decent wages for their work you enable them to protect their environment...Few people choose to destroy the environment unless they are forced to for their survival," GV's brochure says.

The following article from GV's newsletter describes some of the problems of Africa and how trading with African nations on equal terms will help them much more than the usual handouts of development aid money.

Why does Africa need Fair(er) Trade, not Aid?

From Global Village Newsletter No. 14, Summer 1996

The picture of Africa portrayed in the media is by and large one of despaira continent plagued by natural disaster and ravaged by war. The description of the continent's economic and social development outlined in the literature and statistics issued by international institutions such as World Bank, the International Monetary Fund (IMF) or the European Union (EU) makes for equally disheartening reading. It appears that Africa has been caught in a downward spiral of worsening trade conditions, growing indebtedness, contraction of industrial activity and disinterest from private investors which has led to falling social standards, increased urbanisation, environmental degradation. There appears to be an ever-increasing dependence on foreign aid just to deal with humanitarian crises and emergency situations.

Africa's average economic growth has been negative (0.9%) between 1985-1992; average per capital GNP in Sub-Saharan Africa live on less than $1 a dayunder the absolute poverty line. Life expectancy was 54 years (52 in Sub-Saharan Africa) in 1992; only 28% were enrolled for secondary school education (or 18% in Sub-Saharan Africa).

Many reasons are cited for the decline in Africa's economic performance (and hence social and political development). What is more important, perhaps, than identifying exactly the cause of Africa's economic decline is to identify what is central to Africa's present economic situation and to examine how this element could be better managed to contribute to improved economic and social development in Africa at the local and household level. Trade in primary products is one such element.

This short article, and the Africa Information Pack, outline how crucial trade in a limited number of primary commodities such as coffee, cocoa, cotton, tin, bauxite, etc. has been, and remains, to Africa's development. Two thirds of African countries (53 countries, or 356 million people) depend on primary commodities for half their export earnings. Further, Africa depends for over 70% of its export earnings on only three commodities, starting with coffee and cocoa. For Sub-Saharan Africa, these two represent 60% of all agricultural exports by value.

It could be said that, in the past, this dependence on trade contributed to Africa's economic decline. The prices of commodities Africa was selling plummeted while manufactured goods she was importing went up, and Africa developed an extreme debt situation. In response, the World Bank and the IMF imposed "structural" adjustment programmes of stringent cutbacks that had disastrous consequences for social programmes, seriously hurting both the poor and rural Africans, and industrial activity and development, stagnated. Social hardship and political unrest are the inevitable result of the 1980s being such a "lost decade" for development.

For more information get a copy of the Africa Pack (¥500+¥190 postage stamps)from Global Village, Noge 1-13-16, Setagaya-ku, Tokyo 158. If you are outside Japan and would like an Africa Pack, send me 7IRCs or $8US and I will order one for you.

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