International Finance (The problem with Fair Trade Coffee) - Essay Example

Are the advantages liable to encompass a high mass of growers and communities on a worldwide basis? The assignment of deriving answers to these questions is although a long term task, there is also necessity of accomplishing this assignment as soon as possible. Considering the urgency, this paper has been prepared and presented as a move towards finding answers to the above mentioned questions. The barriers to the effective implementation of the fair trade movements all the time act as the reason of the power loss of the entire system.

Considering in-depth review of the case of fair trade coffee, it has been observed that the biggest challenge being faced by the fair trade movement is when it does not allow the grower co-operatives to negotiate prices for coffee with the importers from foreign countries when at the same time, the world prices are at high level. The consequence of the situation is that the co-operatives ultimately have to buy coffee at higher prices from the farmers and they are bound to sell the same coffee at lower prices to the importers of the foreign countries (Jeff, 2011).

Another major challenge of the fair trade movement as identified from the Fair Trade coffee case is that of the lack of knowledge being preserved by the producers of coffee. The reason of the lesser knowledge among producers is primarily the co-operatives’ organization and processes. The producers possess almost zero or minimal knowledge about the fair trade movements because they seldom receive any training from the representatives of the Fair Trade. In certain cases, the producers themselves are the catalysts who worsen the situation of lesser information.

This happens through their reluctance towards attending assemblies of the co-operatives and other similar events. As the market of coffee is cyclical, the prices of this commodity fluctuate greatly. With the growth in the rates of conventional coffee, the obligations towards the channels of Fair Trade deteriorate. The Fair Trade Coffee depicts that with this scenario in concern, the producers fail to operate effectively because the difference between the prices cited by the co-operatives and that prevailing in the market decreases (Murray, Raynolds, & Taylor, 2003).

The reasons for the losing of power of the successful economic justice models are also due to the facts that prove the models’ ineffectiveness in their operations. The experts have criticized the models’ operations recently with the evidence that a few members of the Fair Trade movement are dispatching their intensions of having large corporations or the companies as the members of the movement. It has also been claimed by the critics that there are even certain companies which have received special facilities from the various agencies.

With this evidence, the justice models such as that of the FLO and Fair Trade was enquired of providing unequal treatment to their members and as a consequence they all remained unanswered (Munoz, 2011). The mission of the Fair Trade USA and FLO which is to provide empowerment to both the farmers and the workers across the world through eradicating their poverty has also been criticized by the critics and this can be another probable reason for the loss of power of the economic justice model (Haight, 2011).

The criticism has been against the models’ proclamation that it aims to eradicate farmers’ poverty. The creation of the Fair Tr