Examination of Witness (Questions 176-179)
Ms Anja Osterhaus
24 JUNE 2008
Q176 Chairman: Thank
you very much for coming. We are very pleased to have an opportunity
to talk to someone from Fairtrade because we have not had that
much opportunity in England, not many of the NGOs have talked
to us. I am particularly interested in your views on the less
developed countries, the poorest countries, because there are
quite a lot of people speaking for the developing countries, either
for or against, but we are not getting much of a handle on the
very poorest countries, the LDCs, so we are very glad to see you.
I want to ask a very general question, which is what steps should
European trade policy take to help the less developed countries
reap the benefits of global trade? In that context, do you think
that special and differential treatment and Aid for Trade are
relevant to real development needs?
Ms Osterhaus: Thank you very much. I
do not know if you want me to give you a little bit of background
on Fairtrade.
Q177 Chairman: I should have offered
you the opportunity to make a statement first, if that would be
helpful, to give us a general background.
Ms Osterhaus: Thank you. I was prepared
to answer questions, but I think it might be useful for you to
know where I am coming from.
Q178 Chairman: Indeed it would.
Ms Osterhaus: I brought a book in case
anybody has the time or interest to go into the detail on Fairtrade,
specifically because it has the contact details and it says who
we represent here in Brussels.
Q179 Chairman: Thank you very much.
Ms Osterhaus: Here in Brussels I am the
voice of Fairtrade. We are represented by a little office, very
small, with just two staff, or 1.8 to be exact. We represent the
international Fairtrade movement. That goes beyond the Fairtrade
Foundation which in the UK is the reference point for Fairtrade
and everybody knows the logo and the products are everywhere.
We have had this fantastic growth rate of 80 per cent in one year
of Fairtrade sales. I do not only represent the labelling part
of Fairtrade but all the others, like the Fairtrade companies,
the producer organisations, the support organisations for Fairtrade,
those who help them to export, those who help pre-financing, et
cetera, and also the specialised Fairtrade shops. They are all
organised in different associations and the two that are international
are called Fairtrade Labelling Organisations and International
Fair Trade Associations and they are represented by my office
here in Brussels towards European decision-makers but with other
institutions. We work towards the WTO, UNCTAD, even the International
Organisation for Standardisation, so everything in terms of European
and international institutions are our partners for dialogue.
Against this background, I am very happy that you asked for our
opinion and our view on trade policy in general. You probably
know that basically we see trading specifically under fair conditions
and these products you can buy as a direct tool to support poor
producers, but it is even more a means to an end and in general
the end would be fairer trade rules because we have doubts about
the current system and we are convinced that there are problems,
particularly for developing countries. Our focus is not even at
country level but the marginalised groups in these countries,
particularly the small producers but also workers on plantations
and companies who do not benefit from open trade and liberalised
trade. That is our conviction and we think we have a lot of evidence
to prove that. Our focus is on these groups and that starts to
answer the first question. It is good that the WTO has one country
one vote, that is something. It is good that there is special
and differential treatment and other measures to try and support
the weaker partners in the negotiations to benefit from what has
been achieved. It is better than not having it, there is no doubt,
but it does not systematically address the problems we have in
international trade if we look at it from the perspective of developing
countries and small producers in these countries, which is our
focus. I am not saying protectionism is good. There are many reasons
for protecting your country and your specific sectors just because
you want to protect people there or the ones who make the profits,
you do not want them to lose out, but protectionism in itself
is not a good concept. Open trade can be positive and helpful,
the problem is it does not really address the supply-side constraints
of particularly the smaller players who are the ones who lose
out in globalisation. We know that and that has been proved in
so many different studies that we have. That is not always the
case, of course, there are some smaller producers who benefit
from trade but when we look at specific examples, and our classic
example is coffee, which is the biggest product of Fairtrade,
for decades the coffee producers did not really benefit from the
fact that they could sell the product on the international market,
there were many problems, there were support measures to coffee
producers in Vietnam, et cetera, to overcome their specific problems
and then we had too much coffee and an oversupply and had to depress
prices for decades. That is not helpful. Coffee producers had
to produce coffee under the production costs. That is just one
of the hundreds of thousands of examples we have where we can
see that specific groups definitely lose out systematically. It
is not that this happens once in a while to a group of small coffee
producers, it is systematically a problem that smaller players
lose out in international trade, and this is particularly true
for developing countries. It is good that we have some measures
that address it, but it is not sufficient. One of the reasons
why it is not sufficient is because in most developing countries,
and it is not completely different in Europe, the ones who tend
to lose out, the smaller, weaker partners, do not have a voice
because who decides the rules are the governments influenced by
interests and the smaller producers do not manage to defend their
interests. They do not normally know how to speak to decision-makers
and most of the decision-makers are not interested in listening
to these weaker parts in their society. In the end, systematically
trade rules are not made in favour of these groups. That is a
problem the WTO does not address at all. It does not address this
and it does not systematically address the problems of the weaker
countries because the same phenomenon we have within the countries
exists at the international level as well. There are 153 negotiating
partners and it is obvious that with the European Union coming
with hundreds of specialist negotiators, 10 on a specific issue,
and they sit at a table with maybe one or two from Uganda, the
negotiating power is completely different between the different
players. Even though there are some concessions made we have a
hard time in the EU even to get to common ground on key issues
like agriculture policy. There are some concessions made here
and there but they are not sufficient and do not address the systematic
problems of the small, weaker partners who lose out in the negotiations.
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