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SPAIN: Some Retailers Have Still Not Caught Up With Fair Trade Boom

Teresa Robins

SEVILLE (Spain), Sep 29 2008 (IPS) - Fair trade has grown in leaps and bounds since the mid-1990s but retailers such as El Corte Ingles, the department store chain with the most sales in Europe, are still not giving consumers the choice to buy these products.

Ugandan baskets produced according to fair trade principles. Credit:  Wambi Michael/IPS

Ugandan baskets produced according to fair trade principles. Credit: Wambi Michael/IPS

In 1996 the Spanish parliament introduced an initiative to encourage fair trade products, with regional governments introducing similar resolutions across Spain. The government became a consumer of fair trade products and encouraged local businesses and private and public organisations to follow suit.

Some interest groups have also worked to promote and regulate fair trade. Of these, InterMon Oxfam is a major importer of fair trade goods and has committed itself to promoting African goods, sold under their own ‘‘InterMon Oxfam Comercio Justo’’ (fair trade) label.

In 1997, the Fairtrade Labelling Organisations (FLO) International was set up to establish clear minimum criteria for importing fair trade goods from developing countries. It also set out to oversee standards to make sure these goods were traded at a fair price in the developed countries and were produced under ethical working conditions.

FLO sets a minimum price so producers are able to recover their costs. It also inspects and certifies the terms and conditions under which these small producers work and helps to provide support towards achieving economic self-sufficiency and improving their lives.

FLO has a wide variety of partner organisations involved in charitable, relief and development aid, including international religious, social and economic groups. Their work is divided into two parts to ensure impartiality and independence in its certification process.

The Spanish member of FLO, the Asociación del Sello de Productos de Comercio Justo (ASPCJ) (the Association of Fairtrade Label Products), was established in 2005. InterMon Oxfam is one of the founding members of Spain’s ASPCJ.

ASPCJ’s two main objectives are the licensing of the FLO certification mark in Spain and raising awareness to help boost sales of fair trade products. The ASPCJ confirms that licensed companies selling products under the "Comercio Justo" label have been examined to ensure they fulfil all the requirements.

InterMon Oxfam’s puts the value of fair trade sales in Spain at 7,7 million euros for the year ending June 2007. Fernando Contreras Almela, head of fair trade marketing at InterMon Oxfam, says that 31 percent, or 2,4 million euros, of the sales are for goods from Africa. This is up from 25 percent in previous years.

Its fair trade goods are imported from Burkina Faso, Cameroon, Ghana, Nigeria, Mauritius, Mozambique, Ethiopia, Kenya, Tanzania and Uganda.

‘‘The volume of imports is complicated to calculate, as products such as handicrafts, food and so forth are valued in different currencies and with variable timescales. However, the net average margin is approximately 50 percent, from which costs and overheads are paid. If there is any profit, InterMon Oxfam reinvests this in the producers,’’ according to Contreras Almela.

The following commodities are imported from Africa: batik from Burkina Faso and Uganda; wooden products from Cameroon and Kenya; soapstone carvings and tea from Kenya; cocoa from Ghana; sugar from Mauritius; and coffee from Ethiopia, Tanzania and Uganda. These products arrive in Spain via some 30 African co-operatives serving hundreds of small producers.

InterMon Oxfam regards Africa as a priority, which is why the percentage of goods sourced from Africa has increased. However, growth is difficult to achieve in Africa, says Contreras Almela.

African goods have been much slower in getting a foothold in the Spanish market but there have been significant signs of improvement. However, Contreras Almela told IPS that, ‘‘working with African producers is not easy. This is due to the lack of every type of infrastructure you can think of.’’

African producers are affected by numerous problems at the time of exporting. The most important of these are, according to InterMon Oxfam: high costs, as in many cases the merchandise must travel by air instead of sea, to ensure reasonable transit times and to maintain the quality of the products.

Second, lack of access to information about European markets, with the consequent lack of suitable adjustment between the designs and needs of the consumers and the supply of products.

Third, difficulty in communication. Fourth, problems of access to banking services such as credit. Fifth, difficulty in fulfilling the timescales established for importing the merchandise to ensure it is available for the important times of the year, such as Christmas.

Among retail outlets in Spain stocking fair trade products are the larger supermarket chains, such as Grupo Alcampo, Carrefour, Consum and Eroski. They all have special agreements with InterMon Oxfam to stock and promote these goods as part of their corporate social responsibility programmes.

The retailer Grupo Alcampo holds special promotional events called ‘‘quincedías’’, or ‘‘fifteen days’’, and have staff awareness events to ensure they can talk to customers about fair trade products and their origins.

One noticeable absence among these names is that of El Corte Ingles, Spain’s largest department store group, having taken over the Galerias Group in 1995 which was its main competitor.

El Corte Ingles has large department stores in practically every major town or city, huge hypermarkets and supermarkets and 24-hour, seven-days-a-week shops across the whole of Spain.

On Sept 1, El Corte Ingles announced their annual profits, which showed an increase of 4,7 percent on the previous year, achieving annual sales for the group of 17,898 million euros. In Europe, this puts El Corte Ingles in first place among retailers, well ahead of UK company Marks & Spencer (which supports fair trade products) with its sales of 13,268 million euros.

In the third place is France’s Groupe Galeries Lafayette with sales of 4,960 million euros. Worldwide, El Corte Ingles achieved third place in world ranking for the retail sector, behind U.S. companies Sears Holdings (37,010 million euros) and Macy’s Group (19,207 million euros).

When asked about the absence of fair trade goods at El Corte Ingles’s retail outlets, Diego Copado, director of communication and institutional relations, confirmed that the company had been ‘‘in discussions with InterMon Oxfam over some years but had been unable to reach agreement’’.

He added that, after the announcement of increased profits, El Corte Ingles had also launched its new corporate website which included a section on social responsibility. It is, he said, part of a continuing effort on behalf of El Corte Ingles, which include looking at fair trade.

El Corte Ingles is ''working with a lot of organisations'' in what Copado described as a ‘‘round table exercise’’ on a very wide range of social projects. These organisations include consumer associations, unions, a variety of other local organisations and InterMon Oxfam.

On the subject of fair trade and specifically goods coming from Africa he said that, ‘‘it is not possible for a large organisation like El Corte Ingles to work with so many small suppliers. It is just not feasible’’.

InterMon Oxfam’s Contreras Almela said that: ‘‘El Corte Ingles is making progress in the establishment of its policy of corporate social responsibility and we are advising them in that process, to ensure that the policy is really an efficient instrument to alleviate poverty in the countries of the South.

‘‘If El Corte Ingles is setting out to achieve this, they still have a long way to go to reach the point where it would be possible to establish a relationship of close collaboration with InterMon Oxfam within the sphere of fair trade.’’

So remember, if you want to be sure that what you are buying is a fair trade product and that your money is going exactly where you want it to go, check the label thoroughly.

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