Ethical trade and sustainable rural livelihoods: Volta River Estates Fairtrade bananas case study

The VREL example suggests that plantations can increase livelihood opportunities for certain groups of people without negatively affecting the natural resource base. The contribution to poverty reduction is less clear because while workers’ incomes are at least as high as most other wage earning opportunities, the ultimate impact depends on how cash is distributed and used, and the extent to which full-time employment affects the opportunities of others within the family unit.

Furthermore, despite consciously employing those who have lost land because of the plantations, it is possible that some families have had their access to cultivable land reduced without receiving alternative opportunities.

Production for export has complemented government policy, and has been supported by various tax and other concessions. Both the estateand VROS have also been supported to an extent by the government because they are seen as an example that others in agriculture should follow.

VREL and VROS have made positive contributions to the development of human capital, although direct benefits have gone more to men than women. Although women workers and outgrowers are treated the same as men, women as a whole are less likely to be participants because of the nature of the on-farm activities. Fair trade criteria do not cover this issue as they only address the condition of participants and not those who are excluded from participating.

The biggest benefit of fair trade is that it has increased VREL’s income and access to funds. The guaranteed minimum price producers receive from the fair trade market means that VREL has been able to sell at a higher unit price than on the conventional market, and thus has been able to offset the cost of EU licence fees, high production expenses and relatively high wastage. VREL also benefits because it is a shareholder in Agrofair, which is currently the only importer of fair trade bananas. Without access to the fair trade market, VREL would not be able to compete on the European market [author]