ETHIOPIA, POVERTY AND FAIRTRADE
(click on downloads – Other Resources)
(click on Fair Trade to locate Justin McArthur’s letter)
The FAIRTRADE Mark is an independent certification label awarded to products which
guarantees that disadvantaged producers get a better deal. This brings real change for 5
million people in the developing world – farmers, workers and their families.
- The FAIRTRADE Mark guarantees farmers a fair and stable price for their products
- The FAIRTRADE Mark guarantees farmers and plantation workers the opportunity to
improve their lives
- The FAIRTRADE Mark guarantees greater respect for the environment
- The FAIRTRADE Mark guarantees a closer link between shoppers and producers
- The FAIRTRADE Mark guarantees small farmers a stronger position in world markets
Twenty years ago, in 1985, the world’s attention was rocked by
appalling food shortages in Ethiopia. Ethiopia is not just one of the world’s poor and heavily indebted nations – it is also
the birthplace of coffee and Africa’s
largest producer with 1.2 million coffee growers. Income from coffee sales has been crucial to the country’s economy,
including the payment of its external debts.
However, just four years after Live Aid, the agreement that regulated
international coffee prices collapsed, throwing millions of smallholder coffee growers worldwide to the mercy of the market.
Since then, prices have regularly fallen well below the cost of production for coffee farmers, such as in 2001 when the price
of Arabica coffee beans fell to just 45 US cents a pound. For Ethiopia, the collapse of prices has seen revenue from coffee exports
fall by some 60%, with disastrous results for the country’s longer-term food security and wider development.
Throughout this crisis, the international Fairtrade price for coffee
has remained at US $1.26 per pound – including a 5 cents premium for the farmers to invest in social, economic or environmental
improvements. As well as the minimum price, Fairtrade has also encouraged longer-term contracts, up-front payments and other
investments that have provided farmers with more stability in the face of the crisis.
In Ethiopia, Oromia Coffee Farmers Co-operative Union brings together 35
co-operatives of small farmers. Eight of these, representing over 7,000 farmers, are now certified to international Fairtrade
standards. They now have an alternative to the low-price coffee auctions, and are able to sell some of their coffee directly
to the Fairtrade markets in Europe and
North America. The premium received from Fairtrade means
that they have been able to invest in improving the quality of their coffee by installing machines to wash the beans, and
by committing to organic farming methods. By planting citrus and bananas in between the coffee bushes, they are also reducing
their dependence on income from coffee for their food security.
Under a quarter of Ethiopia’s
children complete primary education, with families unable to afford school uniforms and books, or even food at schools which
can be up to 20 kilometres away from their homes. The Oromia co-operative is now building four primary schools to help farmers
keep their children in school. They are also investing in two health clinics and two clean water pumps for local communities.