Fair Trade in the face of the climate crisis: Supporting livelihoods and the environment

As we recently marked Fair Trade Day, our Head of Nature and Land Use, Chiara Vitali has posted her reflections on fair trade in the face of the climate crisis.

The climate and nature crises inevitably and increasingly loom large on the global agenda as extreme weather events batter cities and communities, and scientists warn of massive loss of habitats. 11th?May marked Fair Trade Day, and on this occasion, we reflected on an aspect sometimes overlooked by concerned observers – the link between poverty and the climate crisis, the need to tackle one in order to avert the other, and the role of fair trade (as opposed to the certification scheme) in doing so.

The imperative of fair trade

The climate crisis disproportionately affects the poorest in the world, many of whom are farmers and producers in developing countries. Unpredictable weather patterns, droughts, floods, and changing seasons are not just inconveniences but threats to their very existence, as shown by the recent wild swings in cocoa prices due to droughts, fires and other climate change-induced weather events in producer regions such as West Africa, which put many livelihoods at risk. The role of equitable trade extends beyond ensuring farmers receive fair compensation; it encompasses providing the necessary support systems to survive, adapt and thrive in changing climatic conditions. Fair trade is imperative in a world shaken by the climate and nature crises. However, it is also key to tackling these challenges.

Decent livelihoods for a stable climate

Poverty and environmental destruction are deeply interconnected. Without economic stability, sustainable practices are hard to prioritise. It is challenging for a farmer facing deep economic uncertainty now to reject techniques that, despite being harmful to the earth, ensure more substantial immediate yields - such as slash-and-burn agriculture and deforesting to plant more land. Fair trade has the potential to challenge this cycle. Ensuring farmers receive a fair price for their goods could be the key to enabling more sustainable choices. Paying an additional premium to invest in innovation, education, and technologies could help bake in more sustainable principles for future generations.

Many of the ecosystems and resources that the world depends upon to mitigate the climate and biodiversity crises are found in geographies inhabited by some of the most economically vulnerable people on Earth. Supporting their livelihoods is key to ensuring a functioning environment for all.

Leaving no one behind

In the context of growing urgency, pressure is rising on governments and businesses alike to tackle their environmental impacts - throwing into sharp relief the sometimes complex trade-offs between environmental protection and development. One recent example is the European Union's Deforestation Regulation (EUDR) - developed by the EU to tackle its imports of goods potentially linked to deforestation, but the target of widespread criticism by producer countries, which claim the law will unfairly exclude smallholder farmers. Some businesses have backed these calls, claiming they cannot comply without excluding smallholders from their supply chains. On the other hand, actors, including the environmental movement and some farmers' associations, have welcomed the greater transparency that the regulation will bring.

Businesses should engage in this debate with honesty and be prepared to be called out should they be seen to hide behind these trade-offs to avoid tackling their environmental impacts. However, these examples throw into sharp relief the complex interdependencies involved and, most of all, the need for dialogue, equal partnership and for those most impacted to have a seat at the table.

Working together, not against each other

In the face of climate and nature emergencies, as well as the complex trade-offs outlined above, debate can slip into pitting development and trade against the environment. However, as we celebrate Fair Trade Day this week, we argue that we cannot protect our climate and the natural world unless society, business and government work together, led by the voices of those most impacted, to chart the complex but necessary course towards sustainable development and fair livelihoods.

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