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ROLE OF TRADE AGREEMENTS IN PROMOTING FAIR-TRADE PRACTICES
1. INTRODUCTION TO FAIR-TRADE AND TRADE AGREEMENTS
International business relationships as embodied on trade treaties and accords are designed with
the view to lessening the restrictions on undertake and to provide for fairer and freer trading
environment. In the following ways, proper design of the trade agreements is capable of eliciting
fair-trade practices. First, through lowering of tariffs and duties they help to liberalize markets
for those exporters who hitherto were being locked out due to high costs. This means that
developing countries’ small producers and farmers can sell their products in the foreign markets
with high demand. Second, through the lowering of barriers by the harmonization of standards
and regulations, trade agreements ensure that the practices and processes involved in industries
are ethical and sustainable. For instance, the USMCA agreement saw better standards of working
laws in Mexico like proper treatment of workers, and wages for minimum wages set in car
industries. Likewise for provisions dealing with environmental standards encourage firms to
embrace cleaner methods that minimize pollution and emissions. Third, whereas previous
generations of FTAs have had little or no references to the concept of fair-trade, current
generations of FTAs contain chapters or at least provisions on subjects such as labor rights and
environmental standards that per se advance the ethos of fair-trade. USMCA, CPTPP, and many
agreements between EU and Canada or Japan all have dedicated chapters on labor and
sustainable development provisions with provisions that if violated results to trade remedies.
Therefore, shifting the paradigm from liberalization of trade in goods and services and
elimination of trade barriers, these modern-day agreements use market access and trade flows to
promote fairness throughout the value chains of global companies. However, to what extent and
in what way such high ideals are achieved is a function of how well the implementation
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strategies is done and how rigorous the enforcement measures are. Countervailing measures
require trading partners to enforce standards through domestic rules and deterring violations.
Last but not least, since postmodernist free trade policies seek not only to reduce trade barriers
but also to guide the ideal and preferential trade practices and flows to become ethical and
sustainable to a greater extent, free trade access incentives and sanction threats that are geared to
the fair-trade policy agenda. Their role and impact however, depends on how partner countries
are willing to translate high aspirations incorporated in texts of trade deals.
1.1. Defining fair-trade and its principles
Fair-trade is a kind of trade system that was adopted in order to create a better future for
producers in the developing countries and guarantee that they are paid a reasonable wage for
their work, the main principle of the fair-trade is to aim at offering stable prices for small
producers of products such as farmers, artisans, and other workers to help support their
livelihoods and enable community development. This entails new forms of trade relations that
are based on transparency, non-discrimination and mutual respect and improved balance in favor
of developing countries through the global supply chain from processing to marketing. In order
to attain these goals, ‘’fair-trade organizations and its supporters promote the following: Firstly,
as a system, fair-trade aims at helping the small producers get buyers who are willing to pay fair
wage led by fair-trade minimum instead of getting them to sell their produce in the open market
which is often characterized by very low and often volatile prices. Similarly, the fair-trade
partners agree to offer workplace safety and health standards, employment without
discrimination, harassment, or the use of child labor, among others. Environmental sustainability
is also crucial as fair-trade fosters proper usage of farming methods, natural resources and
minimizes carbon emissions in trades. Product traceability of the supply chain is crucial in
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reflecting the actual condition and guaranteeing that sufficient fair practices are complied with
throughout the process. In addition, fair-trade supports producer-run community development
projects and capacity building like using fair-trade revenues to set up schools, health centers,
improved quality technologies, or other aspects that help ensure that the communities are not
dependent on handouts or gifts but are sustainable instead. Trade agreements that codify high
standards, encourage openness, and mediate between powerful and less powerful actors can also
reinforce these fair-trade provisions. Trade deals can fight under-aged working, endorse labor
standards, enshrine environmental agreements, advance supply chain tracking through block-
chain among others. They can also eliminate unfavorable agricultural supports, external
tariffs/income or price restraints in developed countries that harm small developing country
producers. In any case, the fair-trade movement is different from the trade agreements as the later
has an ability to complement voluntary approach by signing the realized fair-trade agreements
with governments from different regions that are enforceable and broad.
1.2. Evolution of international trade agreements
International trade has been an important aspect of global economy in the last century with
nations signing treaties and developing rules to make trade more equitable. After the World War
II, General Agreement on Trade and Tariffs (GATT) focused on the growth of trade by reducing
the tariff levels through successive negotiations among the then industrialized countries. This
laid a foundation of rules within which countries could transact with each other hence
establishing a rules-based system for international trade. Other subsequent forums like the WTO
took roots from GATT though it included membership from varied geographical regions. Today’s
trade agreements involve many more economic aspects than import taxation only. Current
understandings include services, intellectual property, investment and regulatory co-suitability.
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They also endeavor to bring a balance of development between one member country and another
within the region. For instance, while specificities in trade between developed countries embrace
regulations and property rights in knowledge, mutual understandings between developing
countries expunges such complexities to encourage involvement. Thus, an integrated, globally
connected economy has emerged, which could allow the country to heighten its growth rate if it
engages more in exporting products. At the same time, the degree of complication has also
enhanced regarding contracts to ensure the fair access and competition in the market
place. Today’s provisions include topics that are export subsidies, dumping, antidumping,
monopolies and state aid. Third, the rules are more flexible in that developing countries are
granted longer periods in which to undertake reforms, some adjustment measures assist in
dealing with trade disagreements. Thus, the function of fair-trade objectives has been gradually
integrated into trade agreements through years of evolution, on top of the initial goal of opening
markets. While some civil society groups condemn this model of global integration, the
international trade flows have become more pluralistic than before involving GFE. International
trade has been increasing in relation to the global GDP, it was below forty percent in 1990 and
crossed the sixty percent in the recent past, such growth proves the expansion of the existing and
potential reach of these agreements among economies of the varying levels of development.
Incontestably, however, it must be said that the negotiations of trade pacts require skillful
management of aspirations even today, but their overall focus remains towards creating fairer
and rules-based competition for the purpose of raising the living standards.
1.3. Key international organizations in trade (WTO, UNCTAD)
The WTO and the United Nations Conference on Trade and Development (UNCTAD) are two of
the most prominent intergovernmental organizations that have played a principal role in the
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development of fair-trade around the world, the WTO is the institution that supports the
multilateral trading system between countries; founded in 1995 following the Uruguay Round of
trade negotiations, its principle objectives are the promotion of free movement and non-
recognition of discrimination while enabling members to realize trade as development. The WTO
currently oversees fifty to sixty agreements, which contain guiding principles of global trade and
offers a forum for trade negotiation among its members, among these are agreements for
example GATT, GATS which has standards that regulates most favored nation and national
treatment in trade. These compel members to be neutral to other traders and not to favor products
and services from their home country over those from other countries. The WTO also supervises
clear and fair procedures for settling disputes in the system, so essential commitments are
maintained and fulfilled, UNCTAD also has a supporting part to ensure that the trade benefits are
optimally realized particularly by the developing countries, it oversees integrated trade
development and treatment while targeting the fair engagement of highly susceptible economies
in the international trading regime. UNCTAD offers support in the form of technical cooperation
concerning trade policy in order to develop capacities that include the positive development
effects of border openings. It helps to develop consensus regarding the supporting frameworks
that may include trade liberalization, trade deals, and commerce benefits that cannot harm social
justice. Policy proposals made by UNCTAD on trade cooperation and poverty reduction provide
the fair rules of regulation that contribute to the overall well-being of society, being partners in
realizing fairness in the international trade system, WTO and UNCTAD have played a significant
role in the elaboration of the developments of the international trade practices and policies.
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1.4. Balancing free trade and fair-trade objectives
Regional trading schemes between countries are essentially aimed at decreasing the existing
levels of restriction on exports and imports, investment. One that should not be overlooked is
having these agreements being conducive to fair-trade. Trade agreements contain working and
legal platforms that can be used to challenge and avoid unfair-trade, including dumping,
subsidies, and other activities that are detrimental to the trade partners, it can prevent such
activities that restrict the operation of business ventures and policies that are discriminative to
foreign companies. Another often debated component of RTAs is labor and environmental
standards – not only are these standards elevated to reflect the increased public consciousness
regarding sustainability and the plight of workers as opposed to the time when WTO was
formed. For instance, in the United States–Mexico–Canada Agreement (USMCA) there are new
provisions regarding labor relations, labor remuneration and labor administration. The fact that
the parties may have contractual commitments for such payments helps promote fairer trade.
However, even if a country signs trade agreements meant to promote fair-trade the
implementation is equally as important through monitoring and enforcement. They have always
been questions of employing children or force labor in some times of some developing
nations. Although trade agreements may ban such matters, the realistic measure depends on the
robust compliance mechanisms that can help identify such abuses and impose sanctions. There
have also been complaints that there is a kind of selective approach to the use of the dispute
settlement cases; the large economic powers do not get punished as much as the smaller
countries do, regional trade agreements are a step towards fair-trade; however, through the
enhancement of review processes and the enforcement of the rules, there is potential for
agreements to further promote equal ethical, and sustainable trade. In the future, the signatory
countries are expected to continue to honor the accords that have been signed. It is useful to
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shine the sunlight on the practices through the trade accords to promote and ensure that the trade
is conducted responsibly, but ensuring the proper implementation is crucial for translating the
words into tangible progress.
2. MULTILATERAL TRADE AGREEMENTS AND FAIR-TRADE
International business involves the flow of goods and services across borders and multilateral
trade agreements are international agreements between countries whose primary purpose is to
liberalize trade and establish a set of rules for the conduct of international trade. Depending on
the agreements of these trade deals, it can be seen that they can encourage open and free trade
between nations in the following ways to support fair-trade. Multilateral trade agreements reduce
high tariffs and quotas; this opens new markets and opportunities for producers in developing
nations to export their produce to global markets. This market access increases the trade
opportunities for the SMBs and farmer cooperatives who may not have the means or access to
economies of scales to directly access the overseas consumers. The measures can be adopted in
multilateral trade agreements with the purpose of setting up norms and rules that pertain to labor
relations, environmental risks and sustainability. For example, the USMCA includes new
language regarding the elimination of child and forced labor and agreements to prior
international environments and wildlife trafficking. They act as a deterrent to the organizations
and ensure that those organizations that want to indulge in unethical behaviors in their foreign
businesses have to change their behaviors so as to be able to enjoy preferential business deals.
Third, the globe’s nations becoming more intertwined and cooperating with one another due to
multilateral trade liberalization can offer stability and create possibilities for joint work on the
resolution of global problems, this connectivity has been utilized by organizations to establish
initiatives whose core purpose is to increase the transparency and to empower producers who are
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vulnerable throughout the channels. Hence, albeit the need for more advancement, the exact
structure and connection made available by MTAs help progress towards ethical and sustainable
trade be achieved. As the standards rise, the access to markets and cooperation through trade
partnerships, multilateral agreements serve as one of the significant ways of achieving fair results
not only for businesses but for the global workers and environment.
2.1. The World Trade Organization (WTO) and fair-trade provisions
The WTO acts as the forum for the establishment of the global trade rules in the form of the
multilateral trade agreements that are intended to enhance fairness in the trade between countries,
the WTO aims to minimize trade restrains such as tariffs and quotas for liberalizing the trade and
make the world market fair for all the members irrespective of their size. However, critics have
noted that developed countries with more resources, and in the political and economic terms
have a competitive edge when it comes to formulating trade rules in the WTO. As such,
measures to support fair-trade have recently emerged as an important factor for the developed
member countries. In November 2001 at the WTO Ministerial Conference held in Doha, the
trade ministers provided the green light to the Doha Development Round to put the development
dimension of the trade system at the center of the further trade liberalization process. Specific
trade liberalization areas entailing fair-trade include; lowering of domestic supports to
agricultural producers, cutting tariffs that high income countries place on products imported from
developing nations, cutting tariffs on exports of interest to developed nations and reforms that
aimed at making it easier for developing nations to access affordable medicines under the Trade-
Related Aspects of Intellectual Property Rights (TRIPS) agreement of the WTO. The developing
nations also said that the WTO’s trade regime should be more permissive on the trade
preferences with regard to trade arrangements between developing nations or between developed
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and developing nations through EPA. The intention of such agreements is to negotiated trade
liberalization whereby the markets are opened unevenly in favor of the developing countries.
Efforts in multilateral trade liberalization centered on the WTO Doha Round of negotiations
which were largely brought to a halt in 2008 mainly over issues to do with agricultural subsidies
in developed nations but moving the front of multilateral trade reform to favor development
continues to be a WTO agenda today. The WTO can and should turn into a great power in the
fight for fair-trade through rules governing trade that can help to curb protectionism in the
affluent countries and open up the world markets for export products of developing countries.
2.2. Doha Development Agenda and its impact on fair-trade
The Doha Development Agenda (DDA) means the round of negotiation for trade liberalization
ongoing under WTO that started in November 2001, one of the goals is to try to reduce the level
of tariff and non-tariff barriers with the view of enhancing world trade. However, a major focus
of the DDA is on the trade, globalization and development questions particularly in the third
world. This is also a clear link with fair-trade practice and standards. A specific working group
on trade, debt and finance was created to assess regarding further improvement of the
coordinated participation of developing countries in the WTO system. Some of the issues that are
under negotiation include; Attempts to ease market access, The limitations on trade distorting
domestic farm subsidies, and providing the developing countries with the capacity to build trade
competent facilities. This declaration underlined that special and differential provisions for
developing countries would be further enhanced, to ensure that they could effectively address the
needs of developing countries, it can be concluded that the DDA may significantly influence fair-
trade, since it promotes broader market access and export opportunities for producers in less-
developed countries, as well as calling for rules governing trade that is suitable for the level of
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development of trading nations. It is easy to understand why the attainment of a balanced and
package deal outcome at the Doha round is involving if not impossible, as the priorities of the
developed and the developing WTO members differ. Nevertheless, situations that the DDA offers
for including fair-trade concerns into the concept of multilateral trade. For instance, a slight shift
in the subsidies, previously provided to a producer in the developed economy, can help the
farmer in the developing country sell products in the international market. It is important to
admit that integration of fair-trade objectives will be achieved by and large based on the
members’ collective action for the WTO that will provide equal opportunities in the trade and
eliminate systemic disadvantages. For multilateral trade relations and fair-trade the DDA remains
a platform where some of the means that may assist in implementing fair-trade practices
internationally can be reviewed.
2.3. Trade-Related Aspects of Intellectual Property Rights (TRIPS)
The TRIPS is one of the most important parts of the WTO system of trade and commerce that
has been introduced to regulate the trade related aspects of the Intellectual properties. Trusted
during the Uruguay Round of the General Agreement on Tariffs and Trade that occurred between
1986 and 1994, TRIPS set the first minimum standards for the protection of almost all categories
of IPRs including copyrights, trademarks, patents, industrial designs, geographical indications
and trade secrets. There are reciprocal obligations that WIPO members have towards each other
through the TRIPS agreement although developing countries where afforded a longer time to
implement the reforms. The general purpose was to eliminate so-called NTMs in international
trade by making WTO members to offer sufficient minimum standard of IP protection in the
interest of encouraging increased cross-border trade and investment in IP-end goods and
services. However, the opponents claimed that TRIPS embodies the neo-liberal trade agenda of
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the developed countries particularly in relation to IP rights to place immense pressures on the
developing countries to quickly adapt legislative frameworks and enforcement mechanisms that
might not be in sync with the level of economic development of their respective nations. This has
created concerns about TRIPS compliance with the “fair-trade” principles especially on equal
participation in the formulation of rules and regulations as well as provision of incentives to
developing countries. To address these issues some measures have been taken as the allowing for
longer implementation periods for the least developed countries, allowing for compulsory
licensing for drugs required to treat diseases of public health importance and retaining flexibility
as to the enforcement of patents in ways that are consistent with normal commercial usage in the
specific country. However, there has been a continuing debate on the question of how and to
what extent multilateral IP rules should be recalibrated in order to empower developing countries
to build their domestic innovation capabilities, to enhance people’s access to knowledge assets
and technologies, and to make sure that IP systems are supportive of their development
paradigms.
2.4. Dispute settlement mechanisms in multilateral agreements
Some of the features of the multilateral trade are that the trade is governed through a set of rules
and in case there are disagreements between members, there are mechanisms of solving such
issues. The World Trade Organization has a coherent system of dispute resolution, which is
regarded as one of the most active in the international arbitration arena. An important point is
that WTO members must address the dispute process if another member claimed the dispute. The
process starts from consultations where the parties make facts clear and seek a common ground
if at all. If left unaddressed a panel is formed to assess submissions and evidence from parties to
the proceedings and come up with a report. They also go through an appellate review if there is
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an appeal by one of the parties. The adopted decisions and recommended actions are intended for
the alignment of the contrary measure with WTO agreements. However, authorized retaliation is
designed to encourage compliance even when the act is illegitimate. A strong, well-defined set of
procedures in dealing with dispute ensures governments and another party in the trading system,
confidence. It can act as a preventive measure against the WTO-illegal actions by its members
that hamper the free trade principle. Findings of the disputes which establish banning of trade
distortive subsidies and discriminative measures have an influence on the competitive imports,
this makes the rules of observance important in gaining access to the markets and essential
requirements of non-discrimination in fair-trade. It also accepts policy space to intervene in the
public interest at the same time. An active dispute system has similar limitations as those of the
PC-AS requirements for recommendations that are politically feasible for governments to
implement and requirements for addressing multifaceted nontariff measures that exist in the
trading environment. Possible changes in the context of the dispute decision are made concerning
its accessibility, the rate of its delivery and its enforceability. Improving dispute settlement
mechanisms and their implementation remains crucial to ensure that the trade agreements, in the
practical sense, make trade of goods in a fairer manner possible. Trade governance has become
an important issue due to the increasing complexity of trade rules and the increasing cases of
trade disputes between large economies, the manner in which the dispute outcomes are enforced
or put into practice will then define if it is in a position to effectively prevent unfair-trade or offer
reasonable remedy to it.
3. REGIONAL TRADE AGREEMENTS AND FAIR-TRADE PRACTICES
Regional trading schemes between countries are essentially aimed at decreasing the existing
levels of restriction on exports and imports, investment. One that should not be overlooked is
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having these agreements being conducive to fair-trade. Trade agreements contain working and
legal platforms that can be used to challenge and avoid unfair-trade, including dumping,
subsidies, and other activities that are detrimental to the trade partners, it can prevent such
activities that restrict the operation of business ventures and policies that are discriminative to
foreign companies. Another often debated component of RTAs is labor and environmental
standards – not only are these standards elevated to reflect the increased public consciousness
regarding sustainability and the plight of workers as opposed to the time when WTO was
formed. For instance, in the United States–Mexico–Canada Agreement (USMCA) there are new
provisions regarding labor relations, labor remuneration and labor administration. The fact that
the parties may have contractual commitments for such payments helps promote fairer trade.
However, even if a country signs trade agreements meant to promote fair-trade the
implementation is equally as important through monitoring and enforcement. They have always
been questions of employing children or force labor in some times of some developing
nations. Although trade agreements may ban such matters, the realistic measure depends on the
robust compliance mechanisms that can help identify such abuses and impose sanctions. There
have also been complaints that there is a kind of selective approach to the use of the dispute
settlement cases; the large economic powers do not get punished as much as the smaller
countries do, regional trade agreements are a step towards fair-trade; however, through the
enhancement of review processes and the enforcement of the rules, there is potential for
agreements to further promote equal ethical, and sustainable trade. In the future, signatory
countries are expected to continue to honor the accords that have been signed. It is useful to
shine the sunlight on the practices through the trade accords to promote and ensure that the trade
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is conducted responsibly, but ensuring the proper implementation is crucial for translating the
words into tangible progress.
3.1. North American Free Trade Agreement (NAFTA) and USMCA
NAFTA Signed in 1994, was a regional trade agreement between the United States, Canada, and
Mexico that aimed at reducing most of the trade tariffs in goods to promote optimum economic
growth. NAFTA also set the objectives of increasing fair-trade practices through banning of
giving certain treatment to state owned companies, the restriction of the use of trade barriers, and
the provision of an equitable trade remedy system. But gradually people became more critical of
the fact that NAFTA led to the losses of jobs and reduced wages for the people of United States
as the companies shifted their production to Mexico where wages were considerably lower.
Therefore, the three countries signed a new deal known as United States-Mexico-Canada
Agreement (USMCA) implemented in 2020. Regarding market access, the USMCA maintains
the absence of tariffs for most goods imported from Canada and Mexico to the United States
while including new chapters aimed at improving the fairness of the three economies’ trading
relations, for instance, the deal has more rigorous rules of origin obligations for the car sector to
encourage more production in the United States and a bigger minimum wage rate. It also obliges
Mexico to enact further labor changes to afford better coverage of the worker’s right to collective
bargaining, which has an objective of equalizing the labor cost on a more even ground,
furthermore, the USMCA also updates rules governing trade in the digital environment in matters
of data governance and protection of personal data. Advocates of a new understandings of the
deal claim that is useful for North American workers and firms through promoting fairer trade
while the opponents note that the new deal is insufficient to stop offshoring incentives. However,
the USMCA may be seen as an effort to update one of the key regional trade agreements to
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address the need to advance more fair cooperation in trade and economic relations between the
three partners in today’s context. Once the effects of the new deal become evident, it will be clear
whether the liberalization of trade and the promotion of region agreements can help to develop
more balanced trade relations.
3.2. European Union trade policies and fair-trade initiatives
The EU has been leading the pack in the formation and enactment of RTAs and regulations in the
pursuit of better trading terms. Currently, the EU is the single largest trading power and this has
helped it push for the liberalization of trade to improve the social and environmental causes, one
of the main uses of many EU trade policies is to ensure that trade is bringing a positive impact in
the economic and social aspects of peoples’ lives. In this regard the EU has entered into bilateral
and multilateral agreements that open up markets while compliance measures aimed at enforcing
labor rights and environmental standards are also incorporated into the agreements. For instance,
all the generation EU trade agreements signed by now have separate chapters on sustainable
development that includes issues like respect of the ILO’s core labor standards, and aspects of
multilateral environmental agreements including the Paris agreement among others. The most
progressive trade agreement that EU has been referred to as being is the EU-Canada
Comprehensive Economic and Trade Agreement (CETA) that was provisionally applied in 2017.
Besides the liberalization of trade barriers, CETA has mechanisms for involvement of civil
society regarding implementation of the agreement; Fox attaches labor and environmental
standards into one chapter known as the Trade and Sustainable Development chapter. The EU is
also continuing the quest for new free trade agreements with Latin American regions, which, as
usual, aims at the promotion of trade liberalization and sustainability policies. While analyzing
the EU’s external trade policies, one can also look at internal trade and the attitudes and
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initiatives of the EU which also reflect the commitment to fair-trade for ethical motives and not
only for the economic ones. For example, diverse EU regulations, farming subsidies, and
labeling rules have been directed in a way to benefit smallholder farms, rural communities, and
more sustainable production structures that are the main principles of the fair-trade movement.
This implies that there is need for a progressive utilization of EU’s Common Agricultural Policy
to foster fair producer outcomes for often vulnerable manufacturers who are mainly from the
developing world exporting agricultural products to Europe. By associating the opening of trade
with better equity and ethical production with progressive agreements and favorable domestic
policies, the EU has taken the leading role in applying regional trade to promote fair-trade closer
to the world.
3.3. ASEAN Free Trade Area (AFTA) and fair-trade provisions
ASEAN Free Trade Area or AFTA is a trade pact agreement by ASEAN focusing on supporting
local manufacturing in the ASEAN region. This is the reason it is aimed at enhancing ASEAN’s
competitiveness as a production hub for export destination by liberalizing the trade barriers with
the member countries in the form of tariffs and non-tariff measures. AFTA also includes the
Common Effective Preferential Tariff scheme whereby imported goods originating from outside
ASEAN are charged between 0 percent and 5 percent while ASEAN member countries can
improve their domestic trade while, at the same time, protecting their industries. The following
are the benefits and concerns that AFTA offers in the promotion of fair-trade practices in the
region, on the welfare side, reducing trade restrictions leads to sound competition, technology
and capital transfer, making efficient industries to spur innovation. The second way that
businesses benefit from larger economies of scale is through increased production which helps
reduce the cost of production per unit. This creates an opportunity to raise the wages of the
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workers and give them adequate working conditions as per the authorities of the fair labor,
however, the main challenge is that critics decry that these concessions compromise the fate of
small-and-medium enterprises and livelihoods in non-competitive industries to the benefit of
large conglomerates. In addition, imported products which are cheaper could also reduce the
price, profits and motivation for ethical standards. Consequently, policies that are supportive of
the trade agenda of AFTA will need to be put in place to guard against social impacts that may
negatively affect the vulnerable groups in the community. These may include funding for
development, training and retraining, subsidies for agriculture as well as standardized codes of
conduct environmental management and social responsibility. They depend on measures
undertaken by enterprises within a suitable environment encouraging compliance with fair-trade
principles, which poses ASEAN’s difficulty in pursuing fair-trade in parallel to trade
liberalization.
3.4. African Continental Free Trade Area (AfCFTA) and fair-trade
The relatively new trade organization known as the African Continental Free Trade Area
(AfCFTA) is one of the significant regional initiatives with an ambitious goal of fostering more
equitable trade within Africa. The AfCFTA provides a framework for the integration of 55
African Union member states into a single market of over 1. 2 billion people with a combined
cumulative gross domestic product (GDP) exceeding 4 trillion. Another rationale for the AfCFTA
is to try and make the trade relations between African nations more balanced. Earlier, trade
relations in Africa have been characterized by the North’s domination at the expense of the
South, with the North being the developed nations and the South being the less developed ones
including the African countries that were colonized by the North. Some of these trade practices
like dumping of agricultural produce that is subsidized has hampered the growth of other local
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industries. With AfCFTA being the biggest free trade area since WTO, there is a great likelihood
for such dynamics to change. The provisions are set in a manner so as to foster export of
processed and manufactured goods as opposed to exporting of mere ores and minerals, it also
offers protection against unmerited trade practices such as import aggressiveness. Thus, the
AfCFTA facilitates the access to a greater regional market by the less industrialized participating
African countries because trade barriers have been lowered. In the pursuit of fairness, the
agreement includes undertakings under the following pillars; competition, intellectual property
rights, as well as investments. These provisions are in an effort to provide better opportunities to
all and promote growth irrespective of one’s status as a large or small economy. Whether the
AfCFTA will work in ensuring fair-trade remains to be seen depending on the implementation
and commitment of member states to promoting the spirit of equitable partnership through local
trade and industrial policies consistent with the AfCFTA’s regional development agenda.
However, as an institution, in both purpose and design, the AfCFTA is a clear step towards
rectifying historical trade injustices and a chance for African countries to forge more prosperous
destinies on their own accord.
4. BILATERAL TRADE AGREEMENTS AND FAIR-TRADE CLAUSES
Trade liberalization means that international relations are regulated by different bilateral
agreements that set out fairer trade relations among nations. Specific fair-trade clauses in these
agreements relate to efforts that seek to promote fair-trade that is more sustainable and has better
impacts on all the stakeholders, one of the methods through which these clauses ensure fair-trade
is by endeavoring to establish standards and policies for aspects such as labor relations,
environmental effects and the pricing policies. For instance, some agreements bar the use of
child labor or forced overworking and require payment of reasonable wages and/ or standards on
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working conditions. They also set policies on how resources are to be harvested and produced so
as to minimize the impacts of human activities in manufacturing and transport, other protective
elements of fair-trade clauses include subsidizing or controlling parts such as subsidies, tariffs,
and prices to prevent bad actors from inflating prices and threatening the stable incomes of those
in precarious situations, such as smallholder farmers. While it is built for two countries and is a
system of bilateral trade, it can affect a large number of supply chains and trade relations in the
world in a positive way by setting certain fair-trade standards. When ethics are traded to major
trading partners, such standards can cover several countries that are involved in the production,
processing or marketing of goods. Nonetheless, this is closely linked to enforcement and
monitoring mechanisms as also provided for in trade liberalization agreements. In addition to
policy objectives and expected gains in promoting fairer trade policies, there must be accurate
implementation procedures and frameworks for addressing injustices. There are still challenges
with ensuring compliance to fair-trade obligations internationally, yet these bilateral deals are
significant building blocks as they set out common rules and requirements that the two parties in
particular have to meet in the conduct of their trade relations. Though not ideal, such bilateral
trade agreements can go a long way in enhancing the adoption of fair and ethical ways of
conducting business within countries, if and when supported by monitoring and implementation
mechanisms.
4.1. Case studies of bilateral agreements promoting fair-trade
Australia and Chile both signed a free trade agreement in which trade and labor chapter that
became effective in 2009 is expected to implement and enhance some of the essential labor
standards of ILO, for instance, the chapter discusses how both countries are bound by
international laws through the ILO conventions on matters regarding freedom of association, and
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existence of laws against child labor. The signatory countries are able to engage in free and
continuous consultation on labor matters of interest to both the countries as well as develop
partnership mechanisms to advance decent employment rights. Ten years after the
implementation of the agreement, there was a study done to determine its effectiveness and it
discovered that there were positive spill-over effects in the two countries, including the
amendment of laws towards enhancing protection of workers such as by raising minimum wages.
One of the pillars of trade relations between the EU and Canada is the Comprehensive Economic
and Trade Agreement that came into force in 2017, it has a clear Trade and Labor chapter. This
chapter restates the Commitments of the countries to encourage ILO core standards on issues to
do with right to organize, forced labor, etc. and give procedures that allow the EU and Canadian
authorities to engage in regular dialogue with regard to labor issues in relation to trade. It is
cooperative in nature and it seeks to ensure that such binding requirements that surround labor
protection and standards are complied with and enforced with regard to matters considered as
trade related, it can also be seen that the provisions embody an approach that has been
considered as a possibility of a model of integrating trade liberalization with the protection of
labor rights. Initial evaluations provided by the Officials of the European Commission and the
Canadian Government suggest that a large extent of mutual discourse on issues such as the
gender pay gap and CSR has been conducted under the pact.
4.2. Labor and environmental standards in bilateral agreements
The ongoing negotiations of bilateral trade agreements mean that there is an opportunity to adopt
clauses that are favorable to proper labor rights and environmental conservation. Current trade
agreements frequently contain a chapter, or side agreement that requires parties to respect certain
fundamental standards of international labor rights including prohibition of child labor and
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forced labor, workplace health provisions, and workers’ rights to organize and bargain
collectively, they also protect environment through pledges to implement national environmental
policies and ratifying international treaties on such matters as poaching of wildlife, or over
exploitation of fish stock or timber resources. This is why fair-trade clauses of these types are
incorporated in a bid to avert ‘the race to the bottom,’ which is a situation whereby different
countries vie for trade and investment by ease on regulations in these areas. However, to be able
to achieve high standards a component which seems to be the most crucial is enforcement. Labor
or environmental breaches, although potentially actionable under the state-state dispute
mechanism provided for in the trade agreement, are sometimes time limited and therefore there
may be restrictions on the remedy for non compliance. In contrast to the previous agreements,
some of the latest policies have proposed the cooperation between the parties on the matters
concerning the capacity of labor and environmental policies and regulations. They expand civil
society engagement and the relationships between governments and societies and their partners
such as business, labor, and environmental organisations to work together to deliver on and track
over time the aspects of R2T. Trade agreements can act as the right stimulus for encouraging
such changes to occur one after another.
4.3. Intellectual property rights and technology transfer
CPA’s can encompass aspects of intellectual property rights and technology transfer between the
participating countries. Assertions of legal protection for intellectual property are based on
promoting innovation by offering inventors an exclusive right to reap their inventions for a
specified period. But this can be a problem if these countries create overly stringent IP protection
systems because such measures may limit the provision of new technologies to countries that can
benefit from them, particularly in the areas of environmental and medical technologies. The issue
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exists in the conflict between better use of IPRs as incentives for innovation where appropriate
protections are afforded to IP assets, and better technology transfer to facilitate development
where access to new technologies is necessary. It is in such contexts that bilateral trade
agreements offer the chance to reconcile these interests by establishing fair-trade clauses that
carefully weigh the provisions of intellectual property rights, for example, agreements could
allow developing countries to implement compulsory licensing for important technologies or to
exercise the defense of the patent system in emergency situations such as disease
outbreaks. Other agreements could also encompass capacity building activity and rewarding
incentives through which multinationals can be compelled to license technologies to developing
states. On the same note, trade agreements may have provisions regarding open collaboration
models of innovation including patents for access. Bilateral agreements provide a framework
within which, the ownership and content of intellectual property and the technology transfer
arrangements are negotiated in a manner that allows developing countries to benefit from
technologies without undermining the incentives for rights owners –proponents of fair-trade. The
controversy on provisions of these aspects in trade agreements is still both, a delicate business
negotiation and it underscores the tension between economic gain, and fair access to the
technologies that can meet the global needs. The optimal framework provides and fosters
innovation worldwide and make sure that these key technologies are accessible at reasonable
cost by incorporating effective intellectual property and technology transfer provisions that
embrace the broader values of innovation and development within a fair-trade and sustainable
context.
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4.4. Dispute resolution mechanisms in bilateral agreements
Contingent upon the kind of business relations, a legal framework of the BTAs has provisions for
the resolution of the dispute associated with the application of the agreement. Such systems
usually have consultation, mediation and arbitration processes in place. Consultation entails that
the countries concerned have to try and agree on a solution that would be satisfactory to all of
them through a process of consultation. If that fails, they may go to mediation where one party is
brought in to assist the countries to compromise. Finally, the last form of arbitration is the
binding arbitration where a panel is able to come up with the decision, which is mandatory for
the countries to work on. By providing an elaborate mechanism to resolve disputes, then the
spirit of compliance with the provisions of a bilateral trade agreement is observed to the later.
Concerning the fair-trade issues, the G2K framework can offer remedies if one of the trading
partners has adopted unfair-trade practices contrary to the legal provisions intended to safeguard
the rights of workers, the environment as well as the public. For instance, if a bilateral agreement
stipulates labor provisions that oblige parties to set some basic employment standards for
workers or environment standards, then the parties can appeal to the dispute resolution
mechanisms if they complain that the other party is not implementing those rules. The risk of
getting a dispute resolution might make the governments close an eye on the violations of the
fair-trade commitments by the national companies. It also assists civil society organizations in
which to lobby governments that are in violation of the plan. Moreover, the findings and
recommendations that are made by the process of dispute resolution mean that governments have
guidance on how to align their laws and policies to the provisions of the fair-trade obligations in
an agreement. Through implementing strong compliance procedures, the bilateral arrangements
may be useful in promoting more ethical trade instead of being a mere platform for articulate
self- interested commerce. It is therefore crucial to have well articulate and clear and enforceable
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regime on the implementation of the dispute resolution mechanisms that will make the rhetoric
of fairness in these agreements to be underlined by substantive justice.
5. FAIR-TRADE CERTIFICATION AND STANDARDS IN TRADE AGREEMENTS
Approved bilateral and multilateral trade policies can offer higher levels of improvement and
equity in trade because they contain provisions and specific chapters on labor, environment, and
human rights. With minimum standards stipulated regarding matters such as wages, working
conditions, use of child labor, deforestation and the rights of indigenous people, trade agreements
can afford structures and enforcement to elevate partnership, trading to a higher standard of
ethical and fairness. For instance, the United States-Mexico-Canada Agreement (USMCA) has
provisions regarding employees’ freedom to organize, as well as the permissible working
conditions such as wages floors and working hours, and bans forced or compulsory labor, it also
has provisions to respond to trafficking in persons. Legal requirements to ensure compliance
with such commitments as the CITES – Convention on International Trade in Endangered
Species of Wild Fauna and Flora. Some of the provisions in the USMCA are obligations that
serve to prevent the import of goods manufactured by forced labor and combating violence
against employees when they are exercising their rights in the course of their work. Solutions
such as state-to-state dispute settlement and the possibility of applying trade pressure introduce
elements of compulsion to these norms. Europe’s trade policies contain requirements regarding
compliance with ILO standards banning child labor, ensuring prohibition of discrimination at the
workplace and permitting freedom of association, they also cite obligations under the Paris
Climate Agreement, though it is unclear which obligations they are referring to. In turn, by
strengthening the supply chain and production through the trade agreements between two or
more countries that are members of the major economic superpowers, or other countries of
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influence, changes that have a broader, industry-wide impact can gradually permeate through the
global market and initiate changes for the better in terms of the level of transparency, ethical
standards, and sustainability. Still there is a lot that can be done in order to ensure that the
principles of fair-trade remain the focus of business relations between the nations in an effort to
champion ethical and sustainable development. However, traditional trade agreements and other
agreements such as the USMCA and EU pacts reveal that trade has the capacity to be a force for
good.
5.1. Fair-trade certification processes and organizations
Fair-trade certification is controlled by several international organizations that establish and
enforce standards as well as offer certification to guarantee that products meet the standards of
fair-trade. Major organizations are FLO-International, WFTO, and the Fair-trade
Federation. These employ rigorous audit and assurance procedures to endorse producers, traders
and goods as meeting standards of paying workers fairly, providing decent working conditions
for employees, addressing impacts on the environment and general welfare of communities. It
involves, for instance, determining the appropriate price for a product such as coffee, cocoa or
cotton and recognizing producer organization that meets the Fairtrade International standards.
The traders in the business also have to be certified to handle the goods produced and sold in the
business. WFTO does more of a job of providing certification to handcraft and manufacturing
supply chain from producer co-ops, export companies, to retailers. It is an auditor of entire
supply chains to guarantee good wages, ethical behavior, and proper working environments at all
stages. The FTF licenses fair-trade wholesalers, retailers and brands mainly in North America,
based on the same principles of ethical purchasing, and sustainability. Both organizations
automatically reassess the members to ensure continuity of compliance. All these fair-trade
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certifiers have a significant part to play in contracts and policies that are intended to promote
enhanced moral trade relations. Their standards can offer specific goals set into the national
strategies and trade agreements to promote and encourage the certified fair-trade initiatives. It
therefore increases both supply and demand for fairly made merchandise. It also helps smaller
scale farmers and artisans from around the world who may not have a lot of export experience
and contacts to get a foothold in the new markets through increased trade in certified fair
goods. Ethical trading partners offer important export opportunities to overseas markets they
could not reach themselves, so relying on them and partnering with them is important.
5.2. Integration of fair-trade standards in trade agreements
Trade agreements can contribute to the development of fairer trading activities given that fair-
trade norms can be incorporated into trading regulations, it is widely acknowledged that the fair-
trade certifications and labels as important tools for fair-trade promotion are not free from some
drawbacks in terms of their ability to create scale and replicate the change across the global
supply chains. If the core principles of fair-trade are incorporated into legally binding trade
frameworks, it could trigger other nations to embrace fairness in their trading relationships.
Some crucial fair-trade standards which could be incorporated in the trade liberalization include
a requirement for setting a minimum price that is above the marginal cost of a sustainable
production for the basic production cost, an extra fairtrade premium for development
expenditure, provision of decent employment status through the entire supply chain, long-term
and stable trading relationships and environmentally friendly and sustainable methods of
production. Including such standards into the free trade agreements, association agreements, or
the bilateral investment treaties will make them into stronger obligations enforceable for a higher
number of MNEs rather than as voluntary standards of good practices. This could also assist in
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providing a leveller so that companies, which embark on sourcing from ethical means are not at a
disadvantage compared to firms that use exploitative measures in cutting costs. The following
are challenges: It is difficult to achieve consensus with partners involved in the negotiations on
which provisions of the fair-trade should be included; It is always hard to overcome resistance
from the private sector that only wants easy regulatory framework; There is also the challenge of
creating sustainable mechanisms for monitoring and supervising the fair-trade policies.
environmental and labor standards have been included in the recent mega regional trade
agreements that may suggest increasing political willingness to use tools of trade policy to
promote improved equity and sustainability in international production networks. When attention
is paid to the current concern of the developed nations and the level of development of the
developing countries, there could be serious trade motivations that could incorporate fair-trade
standards in their trade agreements, which would serve as a powerful tool to encourage better
corporate sourcing.
5.3. Challenges in implementing fair-trade standards
Applying fair-trade standards for making a fair-trade all across the supply chain is not a simple
process and requires much attention. Large and extensive supply chains across boards may make
implementation of fair wages, ethical working conditions, and environmental sustainability
measures a challenging endeavor due to the differences in regulation across countries. While
some first income consumer countries strive to develop legislation for ethical trading, there are
always issues concerning the enforcement, especially targeting less developed trading partners
whereby regulatory authorities often lack the necessary funds and institutional backing.
Hindrances that affect the efficiency of the fair-trade reforms are evident at the two poles of the
trade systems. Exporters that are seeking to tap into the sensibilities of consumers in the
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developed world through socially sensitive labels have challenged themselves in trying to adopt
certified production and labor standards across the entire value chain. In smallholder farms and
workshops situations where the extra costs of meeting social or environmental criteria are
absorbed, the necessary financial and technical requirements for transitions are often missing,
while many of the farms and workshops are unaware of the standards which are designed to help
them tap into the premium niche markets. Likewise, sometimes the governments of importing
countries may face challenges in implementing reforms due to opposition from domestic
stakeholders who benefit from the current trade regime, which focuses purely on cost
advantages, and this erodes political commitment and leadership. Harmonization of regulations
to eliminate the gaps also creates controversy when attempts are made to ‘raise the level’ of
practices to the highest standard that has created compliance gaps or higher operation costs
considered as barriers to trade by some players. On the same note, demands to start raising
domestic labor and environmental standards in both developed and developing countries have
raise protectionism allegations and hampered overtures to agreement on how to apply uplifted
laws for fairly trading universal products, in accordance with human and sustainable
development values and principles of moral rather than the free market dogma. To resolve this,
there has to be development of trust over the motives that different trading partners have behind
the adoption of higher fair-trade standards that will create the foundation for open dialogue
towards establishing not mixed but parallel ethical trade systems given the diverse national
settings of the trading partners. Additional resources for technical support and actualization of
common benefits in the long haul can replace the short-term transitional cost and disruption
which are discouraging factor for all the stakeholders.
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5.4. Impact of fair-trade provisions on developing countries
The liberalization of trade has the potential of explain the effectiveness of fair-trade provisions in
the context of trade agreements for developing countries. Enabling the setting of standards and
the certification of products that will be allowed to be labeled fair-trade only, these measures
endeavor at achieving fairer pay and improved working conditions for producers from the Third
World. However, the adoption of these standards entails costs for certification and compliance
that can be costly for small producers or farmer organizations who often lack capital or
engineering support. However, due to the fact that fair-trade certified products are more
expensive than other products, the costs of fair-trade certification to the growers may be higher
than the benefits, to some growers. Of course, extremely high standards may be prohibitive to
many producers especially those in the lowest income bracket and as such, there is probability of
locking out the poor producers. On the other hand, fair-trade provisions can help facilitate
structured market access to better export markets along with sustainable farming methodologies
and promote contractual relationships in the long run through contract assistance programs. They
balance the buyers and sellers’ power where one forms the other as traders and producers are
dominant. Meets certification criteria concerning matters such as environment and labor rights,
facilitate the involvement of developing countries in ethical global supply chains. Fair-trade
agreements increase farmers’ income certainty since they can sustain contracts for more than one
year. Other cognitive studies also link fair-trade certification to increased efficiency arising from
the capital investments that fair-trade incomes fund. Some producers may not be benefiting from
these markets because compliance costs discourage them from doing so; additional financial and
technical support could go a long way toward addressing this issue. All in all, fair-trade
provisions can be helpful in improving the conditions of the required producers through the
possibilities to receive the higher price for the goods and enter the market; nevertheless, it can
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also be detrimental for the poorest producers who can be excluded from the fair- trade system
due to the lack of the resources required to meet fair-trade standards without development aid
and partnership. Therefore, policymakers have the responsibility to ensure that compliance and
accessibility for all lead to improved results. Thus, it may be concluded that strategic creation of
provisions and corresponding targeted efforts to develop the supply-side seem to be vital for DCs
to better exploit FT opportunities in trade arrangements.
6. FUTURE OF FAIR-TRADE IN INTERNATIONAL AGREEMENTS
Through trade agreements, fair-trade practices could easily be applied globally as a way of
improving the lots of the less privileged societies. Since they are involved in international
relations, international organizations such as WTO are expected to encourage more countries to
come up with agreements that include fair-trade provisions, and therefore the world will be
conducting business under basic ethical and environmental standards. There is already a trend of
this kind as evidenced by the hint at labor and environmental chapters in the recent mega-
regional trade agreements such as the CPTPP. In the future, trade liberalization settings may push
further the sustainability of production processes, secure workplaces, and reasonable
compensation globally. Examples of chance for agreement that can increase fair-trade are, for
instance, the possibility to receive preferential customs rates for the products that correspond to
specific qualifications regarding social and environmental standards. The idea of assured access
to large consumer markets may compel more producers in the developing countries to get
fairtrade, organic or other Source certification indicating ethical sourcing. Policies could also bar
the import of goods whose production involves forced labor or other heinous workers’ rights
abuses. It would require the countries entering into the agreements to make certain improvements
show on compliance with certain labor rights so as to continue enjoying certain trade benefits.
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This would set a positive trend for liberalizing trade access in exchange for progressive
enhancement of corporate governance standards/Company disclosure on treatment of workers in
supply chain. Of course, trade agreements are artfully crafted with due regard to national self-
interests. There is the possibility of creating more fairness in trade by means of balancing goals,
transition periods, and deals in the middle of the process. Nevertheless, the idea of using trade to
promote more favorable developmental effects has already been started and integrated with early
measures on these issues in current trade agreements. To achieve a fair-trade in the future, such
forms of clauses must be strengthened and developed to become one of the main principles of
international business in the future years. As there is increasing discourse and voice from the
civil society that demand fair labor practices and non-exploitation of the environment in the
global supply chain there is the potential of making trade agreements to be the catalyst for
change.
6.1. Emerging trends in fair-trade practices
As the market globalization unites and at the same time gets more competitive, some significant
tendencies can be observed, the goals of which are to achieve fair-trade relations. One important
trend is the development of numerous voluntary sustainability and ethical labels which assist the
public in making a right choice in regard to what they purchase. For instance, fair-trade labelling
programs are also being expanded as they help guarantee that farmers and workers in the third
world receive reasonable prices for their products and employers observe humane treatment to
their employees. Similarly, there is an increased focus on ‘ethical consumerism’ with people
purposefully choosing to buy products from companies that have a clearly stated and more
ethical sourcing system. This leads to more consumer awareness and demand for sustainable and
fairly traded products hence more companies are persuaded to adopt fair and sustainable trading
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practices that consider social and environmental effects, the fair-trade practice is now finding its
way to being incorporated into trade relations between countries at bilateral and multilateral
levels. NTMs are being substituted into free trade agreements to be supplemented by additional
chapters or provisions that protect labor and environment of all the trading partners.
Governments are also offering more funds to support small farmer and producer in developing
countries to meet the necessary requirement that are required to export to these countries. Such
tendencies towards ethification of purchasing point to the fact that the concept of fair-trade is
gradually moving from being an avant-garde movement to becoming an established part of the
contemporary global economy. In the future, blockchain system and traceability software
integration may be the key to complete the organizational transparency for the established fair-
trade products. When more manufacturers identify and bring in the info regarding their second
and third tier suppliers, it will further fight against exploitative labor and fake sustainability
reportage. The trends indicate that through technological advancement in transparency, observed
increase in consumer awareness and favorable trade policies, ethical and equitable trading
practices will in the future become the new global economy norm for human rights and environs.
6.2. Digital trade and e-commerce considerations
With rising complexity of the global trade, or an integral part of the world trade, it is becoming
easier for members to bring provisions based on digital trade and e-commerce, both opening up
opportunities and presenting challenges to fair-trade in these fields. Thanks to the emerging e-
commerce platforms and digital tools, the small producers and businesses from the developing
countries have new opportunities to enter the Export Markets they could not earlier enter. Such
enablement could indeed be useful to integrate into trade agreements to enhance the
opportunities for smaller enterprises interested in exporting goods and services online across
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their borders. However, reasonable policy space is required in the accords to enable the
governments for development of domestic digital industries especially those from the developing
nations. On the same note, current fair-trade standards and concerns that revolve around
production techniques, employee treatment, and fair pricing models must be respected and
effectively transposed in the new digital economy. Transparency of the platforms’ algorithm and
resultant ratings, affecting market accessibility, is also necessary to ensure fairness for all the
vendors. Data flows which form the foundation of e-commerce require that agreements ensure
that the systems allow for openness to support innovation while providing measures for the
protection of privacy and security. Moreover, equal opportunities and equal access to the internet
and digital infrastructures remain an unfulfilled goal in developing countries and countries that
are relatively poor, thus, there is a possibility of continued marginalization of vulnerable groups,
communities and individuals in global trade unless measures that balance partnership with
technology transfers and capability-building enclosed within the trade partners are pursued.
Neglecting such aspects can only perpetuate and, in some cases, possibly even deepen
international disparities. In conclusion, effectively electronically enabled trade requires revisiting
policy measures to foster fair competition and benefits distribution as well as address sustainably
new divides and risks associated with data abuse and market access – all foundation principles of
fair-trade for sustainable development.
6.3. Sustainable development goals and fair-trade
Sustainable development, as defined by the United Nations (UN), is a process of economic
growth that promotes employment and reduces poverty, as encapsulated by the Sustainable
Development Goals (SDGs) that were adopted in September 2015, particularly, the goal 12 of the
SDs deals with sustainable production and consumption practices, which is related to the
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principles of fair-trade. Since global trade relations are regulated through international trade
agreements, the re-orientation of these accords towards fair-trade practices would contribute to
the fulfillment of the SDGs by 2030. At present, the international trade law, for the most parts,
targets liberalisation of trade and the economical approaches; ethical trade aspects are given
marginal importance in typical trade agreements. As we continue the progress, ensuring that fair-
trade policies are set alongside the core SDGs will assist in changing the consumerism and
production to sustainable and fair globally. For example, comprehensive trade-related
commitments can be associated with special provisions that benefit specific sectors such as small
farmers and laborers in fulfilling SDG 1 on no poverty. Sometimes provisions can provide
farmers with the ability to access finance as well as technology that will help in the formulation
of sustainable farming. Additionally, there should be compliance with labor and environmental
conditions in the 8 and 13-15 goals of SDG. Market access through tariff reductions for fairly
traded goods and fair-trade public procurement can increase the market for such products thus
help in realizing the agenda of SDG 1, 8, 10 and 12. Much depends on what the agreements on
international trade will contain in the next decade for SDG 12 to prove successful. This
framework indicates that current trade agreements need to extend beyond market- access
concerns and embrace other aspects such as providing policy space for members to support the
principles of fair-trade at the national level. Moreover, trade agreements should be composed of
specific and separate chapters and provisions in the sphere which determines fair, ethical and
sustainable trade with regard to the economic, social and environmental aspects. As global risks
like climate change and growing economic disparities pose risks to development, positive trade
enablers offer an avenue for sustainable reform and globalization.
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6.4. Reforming trade agreements to enhance fair-trade practices
There is still the chance to reform the current trade relations and design the new ones: With the
deepening of trade relations around the globe, there is a possibility to introduce the necessary
changes to the existing trade agreements and create the new ones that will be efficient and fair.
When these standards are incorporated in trade agreements, governments aid in creating an
enhanced working environment, sustainability, and growth of economies of all parties involved
nations. For instance, it is possible to incorporate clauses that entrench respect of labor standards
and remuneration, the repeal of trade distorting subsidies, the reduction of pollution, and the
attainment of targets on use of renewable energy and efficient use of resources. Such terms
would especially benefit developing nations in how they would avoid a downward spiral on
standards such as wages and environmental norms. In order to ensure that fair-trade
commitments are used as tools for motivation then reformation also comes with the need to
incorporate monitoring mechanisms and enforcement policies in the agreements. Trade
preferences might actually be tied to furthering particular aspects of fair-trade in particular. With
the emergence of new models, such as the CPTPP, members have a new opportunity to start from
scratch in testing innovative ways of advancing just, ethical trade – whether this means adding or
deepening social clauses; offering customs incentives for voluntary sustainable practices; or
developing mechanisms for handling labor grievances. Revamping current trade accords such as
the North American Free Trade Agreement (NAFTA) also signifies an opportunity to correct
imperfections and lacking components for equitable returns in worldwide commerce. The
changes in trade agreements can be considered as a significant factor that represents a practical
way to promote the spread of increased ethical norms globally. By building in higher standards
and measures on the key areas including environment, labor, workers’ right and social well
being, new trade frameworks can foster new benchmarks in corporate responsibility in the
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international arena. International trade is a fairly technical area which many consider remote and
enclosed in various trade agreements, but change in this area may have significant social and
economic implications on the ground.
