Small farmers are disadvantaged in international trading. With fair trade Malawi farmers have a way to earn a better living. This is because growers under its umbrella are guaranteed payment above global market prices.
Increased income is vital for a poor nation in which over 84 percent of workers are toiling in agriculture. Here average land holdings cover a very small area. Just one hectare. There is little room for expansion in this densely populated country. Since agriculture constitutes 90 percent of export earnings, it is vitally important to the economy. Thirty five percent of the GDP is contributed from this sector.
This is one of the poorest countries in Africa. Its Gross Domestic Product per capita is not even half the average for Sub-Saharan Africa. It has an income inequality that is unmatched in the continent. Life expectancy is very low. It is just forty one years. The child mortality and AIDS and HIV mortality rates are among the highest in the world.
Agricultural production was liberalized in 1994. This change brought new challenges. Liberalization caused a huge decline in commodity prices. Middlemen cheated smallholders out of their deserved earnings after 2004 when Government stopped directly purchasing goods.
Agriculture sector learned that by collecting together the organized producers can get better prices. The National Association of Smallholder Farmers, NASFAM, today represents over 108,000 farm families. Supportive institutional infrastructure has helped to provide training and establish quality management systems. Cheated producers now have another route to prosperity to earn the fruits of their labor with the added support of the international trading partnership to boost their efforts.
The force behind this partnership is the vision of the Fairtrade Foundation. Its primary goal is to bring greater equity in the international agricultural markets. Minor producers are offered improved trading terms. But to join they must first commit to certain norms. These are the economic, environmental and social standards set by the body. Social norms require the respecting of labor rights and democratic decision-making processes to members the opportunity to participate. The economic standards guarantee a minimum price. This price covers both production costs and an additional amount that may be utilized for a development purpose. The environmental standard encourages sustainable business and agriculture practices. Presently there is a focus on diversifying to bring added value. There is hope this will bring more local processing opportunities to create more jobs and improve prospects for the development of regional markets.
Buyers are encouraged to participate in long term contracts and to offer pre-financing. This helps to level the playing field. It also guarantees a trading system which offers traceability and transparency to consumers. This makes them more willing to pay the higher prices such products may demand. But more consumers are keen to support ethical practices, especially as more are learning of the short cuts large producers take that may detrimentally affect their health.
There is certification to confirm the standards are met along the supply chain. Since 2004 more than twelve thousand four hundred smallholders entered the global market through this partnership. Already the results are heartening as indicated by a study conducted in 2010. The support of fair trade Malawi partnerships has reduced poverty in the country.
Increased income is vital for a poor nation in which over 84 percent of workers are toiling in agriculture. Here average land holdings cover a very small area. Just one hectare. There is little room for expansion in this densely populated country. Since agriculture constitutes 90 percent of export earnings, it is vitally important to the economy. Thirty five percent of the GDP is contributed from this sector.
This is one of the poorest countries in Africa. Its Gross Domestic Product per capita is not even half the average for Sub-Saharan Africa. It has an income inequality that is unmatched in the continent. Life expectancy is very low. It is just forty one years. The child mortality and AIDS and HIV mortality rates are among the highest in the world.
Agricultural production was liberalized in 1994. This change brought new challenges. Liberalization caused a huge decline in commodity prices. Middlemen cheated smallholders out of their deserved earnings after 2004 when Government stopped directly purchasing goods.
Agriculture sector learned that by collecting together the organized producers can get better prices. The National Association of Smallholder Farmers, NASFAM, today represents over 108,000 farm families. Supportive institutional infrastructure has helped to provide training and establish quality management systems. Cheated producers now have another route to prosperity to earn the fruits of their labor with the added support of the international trading partnership to boost their efforts.
The force behind this partnership is the vision of the Fairtrade Foundation. Its primary goal is to bring greater equity in the international agricultural markets. Minor producers are offered improved trading terms. But to join they must first commit to certain norms. These are the economic, environmental and social standards set by the body. Social norms require the respecting of labor rights and democratic decision-making processes to members the opportunity to participate. The economic standards guarantee a minimum price. This price covers both production costs and an additional amount that may be utilized for a development purpose. The environmental standard encourages sustainable business and agriculture practices. Presently there is a focus on diversifying to bring added value. There is hope this will bring more local processing opportunities to create more jobs and improve prospects for the development of regional markets.
Buyers are encouraged to participate in long term contracts and to offer pre-financing. This helps to level the playing field. It also guarantees a trading system which offers traceability and transparency to consumers. This makes them more willing to pay the higher prices such products may demand. But more consumers are keen to support ethical practices, especially as more are learning of the short cuts large producers take that may detrimentally affect their health.
There is certification to confirm the standards are met along the supply chain. Since 2004 more than twelve thousand four hundred smallholders entered the global market through this partnership. Already the results are heartening as indicated by a study conducted in 2010. The support of fair trade Malawi partnerships has reduced poverty in the country.
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