Question

1s. What is fair trade? Your answer should explain what the concept means (according to civil society organizations, not Donald Trump), and identify at least one of its limitations. 200 words

Answer 1

Ans.

Introduction

Fair trade is actually a trade practice between various developing and developed countries where the developed countries are mostly the buyers and developing ones are the sellers which ensures that fair prices are being given to the developing ones for their produce. Since the developing countries are not so rich and they have to spend more money as compared to developed ones to produce the same quantity of produce due to their low level technology etc and because of this, their labour suffer the problems of low wages, hence to solve this issue, there comes a concept of fair trade.

Hence in simple words, it is a practice of trade or trading partnership in which there is more transparency and respect and there is more equity among the countries and hence helps in ensuring sustainable development and help them providing better market conditions and reducing the inequality.

It is actually beneficial for the poor community, farmers and workers or labourers in developing countries which are producing those products.

Limitations

The major limitation in this are as following

1. it provides help to only a small number of farmers in the developing countries and the large number of labourers in unorganised sector do not get any benefit from this.

2. Among the farmers only, it benefits the large farmers since the small ones are unable to fulfil conditions for certifications.

3. Many times, they impose extra tariffs on their goods which is harmful in the international market.

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