Fair trade international trading partnerships help disadvantaged producers, farmers and farmersÕ societies to get better prices for their products, while ensuring quality and environment-friendly products.

Organic farmers in this hilly, central region of Sri Lanka are convinced that they have a simple fair trade model that could be replicated in other parts of the world.
“What we have created is the most sustainable model of fair trade and organic food in the world,“ insists Sarath Ranaweera, founder of the Small Organic Farmers Association (SOFA), speaking with Ipsnews.net.
Fair trade international trading partnerships help disadvantaged producers, farmers and farmers’ societies to get better prices for their products, while ensuring quality and environment-friendly products. They bring suppliers (farmers/producers), traders (exporters and retailers) and consumers together in an equitable partnership where the consumer pays a premium for the product and part of the premium goes back to the farmer/producer for his social welfare and uplift.
Last month SOFA received a fillip when the Fairtrade Labeling Organization (FLO), a leading standard setting and certification organization approved it as a model of good practices. “SOFA is a great model that we could use to replicate in the rest of the world,“ said Christophe Alliot, deputy director of France’s Max Havelaar, the French member of FLO, after a field visit.
Products that carry the fairtrade certification guarantee that producers in the developing world get a better deal, according to Alliot.
Alliot and two of his colleagues from FLO partners in New Zealand and Britain were in Sri Lanka attending a two-day meeting of the NAP (Network of Asian Producers), a grouping formed two years ago under the FLO umbrella to provide a voice for Asian producers. During the Sri Lankan visit, the FLO team decided to visit Ranaweera’s project in the hills and was astounded with the model.
“Its is quite amazing how these farmers have combined biodiversity and organic food production,“ said Alliot in the backdrop of efforts by FLO to look for a sustainable model that would convince doubtful consumers that producers are actually benefiting from the premium price.
In fact, Ranaweera, whose SOFA initiative follows his own entry into the production and marketing of organic food through his company Bio Foods (Pvt) Ltd, is an acknowledged expert in fair trade and travels around the world talking with consumers and convincing them that producers benefit from FLO.
“Fairtrade wants to use our model as the organization is under attack in the rest of the world. I am constantly being asked to speak to consumers on how fair trade benefits farmers. Consumers, at international gatherings, ask us to show proof that the money (premium) is actually going to producers,“ said Ranaweera, who has degrees in food science and technology, and agriculture in addition to experience as an international consultant in tea processing and research.
FLO, he said, was planning to send a team to work with a group of undergraduates from the University of Peradeniya in Kandy to formulate a workable model based on the SOFA initiative.
W.R. Punchibanda, 64, is a typical hill farmer who grows tea, coffee and spices on his sloping 2.5 acre land but earned little till SOFA came along. “Around 1980 I would pluck some tea leaves from the garden and sell it to the local shop for a few Sri Lankan cents per kilo to buy bread or some food. In a month, we would get about Rupees 50 from tea,“ he said.
But when Ranaweera came along and sold the concept of SOFA to farmers in Kandy and adjoining districts in 1998, Punchibanda saw his tea earnings rise to rupees 2,000-2,500 ($22) per month. “That’s not all; SOFA has done a lot of welfare work (using the Fairtrade premium) looking after members and their families and taking care of the community.“
Ranaweera argues against the common fair trade practice of getting producers to double as marketers so as to get the best possible price and shut out the middle man. “Our model has proved that producers need not be bothered with selling and marketing, as long as they are guaranteed a price and assured markets.“
SOFA, with more than 2,000 farmers and some 30,000 dependants in the production chain, is the first ever Fairtrade association of spice producers and touted as the most sustainable farmers’ organization because it gets the Fairtrade premium direct to its coffers.
Tea, for example, receives a premium of one Euro per kilo in the price tag if sold in Europe and this money goes straight to the producer.

An increase in the supply of land and houses is as important as measures to control demand either for improving living conditions or for speculation.

To rein in soaring house prices in many Chinese cities, an increase in the supply of land and houses is as important as measures to control demand either for improving living conditions or for speculation.
According to Chinaview.cn, Shenzhen’s latest progress on reclaiming idle land lots might deal speculative property developers a heavy blow. But it is far from a decisive move needed to check excessive hikes in house prices partly caused by a shortage of land.
It was reported that the municipal government of Shenzhen recently re-examined 738 approved construction projects and took back 27 land lots left idle for at least two years in accordance with a land use regulation.
This effort aims to prevent property developers from hoarding land, a practice believed to have aggravated the shortage of housing supply. Such strengthened law-enforcement will surely give a warning to those developers who have banked land for higher profits.
Obviously, if land lots left unlawfully idle are reclaimed by the government as new land or immediately put under construction by developers, the supply of housing in the local market will get a considerable boost.
But in comparison with the need of a huge increase in land supply to cool the housing market, such efforts are just tinkering at the edges of a problematic land supply system.
It is reasonable for local governments to strictly control the supply of land. As the world’s most populous country, China faces a tough task in preventing real-estate projects from eating too much into its declining stock of arable land.
Yet, when tightening supply of land adds fuel to runaway house prices, local authorities should first take stock of available land lots and then put them on the market as soon as possible. Of course, they should also require property developers to make more efficient use of these land lots.
The government’s move to increase land supply will in itself send a strong signal to the red hot property market. Some potential house-buyers will put off their purchases in the hope that house prices will stabilize soon.
Those developers that have banked land for higher profits will find that it will be at their own peril to delay construction if other competitors are grabbing a bigger market share.
House prices in 70 large and medium-sized Chinese cities rose by 9.5 percent year-on-year in October. The rise, 0.6 percentage points higher than that of September, hit a new high.

Providing technical advice and know-how to member countries is a vital role of the IMF in a globalized economy.
The Fund is seeking to enhance its partnership with donors in its technical assistance program. The aim is to improve the effectiveness of IMF technical assistance and training by leveraging on the development assistance strategies of donors.
A key benefit of IMF membership, technical assistance--over 80 percent of which goes to low- and lower-middle-income countries--is aimed at building the institutions and skills needed by countries to design and implement macroeconomic policies that promote growth. To ensure strong country ownership, IMF technical assistance is designed and delivered within the context of each recipient country’s economic reform strategy and priorities.
Although the largest portion of IMF technical assistance is funded with its own resources, contributions from bilateral and multilateral donors have played an increasingly significant role in enabling the IMF to meet country needs in this area.
“The participation of donors in our technical assistance program flows naturally from our mandate to promote international economic cooperation,“ says IMF Deputy Managing Director Murilo Portugal. “We believe that strong partnerships between recipient countries and donors enable IMF technical assistance to be developed on the basis of a more inclusive dialogue and within the context of a coherent development framework. The benefits of donor contributions therefore go beyond the financial aspect.“
Beginning in the early 1990s, IMF cooperation with donors on technical assistance projects has grown steadily. External support--provided in the form of donor grants to the IMF--now finance around one-fifth of the IMF’s total technical assistance. Of the more than 25 donors who support this work, the government of Japan remains the single largest contributor.
Since 1990, total Japanese support for the IMF’s technical assistance program has exceeded $230 million, covering projects in more than 120 countries in all areas of the IMF’s expertise. Apart from Japan, the United Kingdom’s Department for International Development and Switzerland’s State Secretariat for Economic Affairs represent two other key contributors to the program, each financing over $20 million worth of technical assistance over the past decade.
As the IMF’s technical assistance program continues to develop, donor partnerships have similarly expanded to include grants from Australia, Austria, Brazil, Canada, China, Denmark, Finland, France, Germany, India, Ireland, Italy, the Republic of Korea, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Russia, Singapore, Slovenia, Spain, Sweden, the African Development Bank, the Asian Development Bank, the European Commission, the European Investment Bank, the Inter-American Development Bank, the United Nations Development Program, and the World Bank.

Naming yourself after the three-headed dog that guards the gates to hell was, perhaps, asking for trouble. Cerberus, the private-equity beast in question, now finds itself at the center of a fierce debate about whether corporate America is in for a hellish time, as the credit crisis spreads from financial services to the rest of the economy, Economist.com reported.
Only months ago Cerberus was praised as the savior of the American car industry when it bought Chrysler from its German owner and struck a remarkable deal with the unions to cut jobs and benefits. But on November 20 it emerged that Cerberus’s bankers had abandoned efforts to sell $4 billion of the debt it took on when it bought Chrysler. Investors turned up their noses even when offered a 3 percent discount.
Cerberus has also been hit by growing problems at GMAC, the financing arm of General Motors, in which it bought a 51 percent stake for $14 billion last year. GMAC reported a net loss of $1.6 billion for the third quarter, up from a loss of $173 million in the same period last year.
What happens to private equity may be a leading indicator of how the crisis in the financial system will affect the rest of the business world, both because private-equity deals are so dependent on large amounts of debt, and because many of the shrewdest judges of corporate value work for private-equity funds. The number of new private-equity deals has plunged with the financial crisis, and nobody expects activity to pick up again soon. The collapse of deals suggests that the business climate has changed sharply.
But how? Were the cancelled deals so marginal, and so dependent on cheap credit, that a relatively small rise in the cost of debt ruined them? Did Cerberus conclude that prospects for the American economy are now too bad to go ahead with the United Rentals deal? Does it see better uses for its capital elsewhere, in distressed debt, say? Is that $10 billion of liquidity really available? And is it really true that as goes Cerberus, so goes the rest of private equity, and the rest of business?
The only truly upbeat firms in America nowadays are the accounting giants, which for once are not being blamed for a financial disaster. They are determined to keep it that way, and are said to be racking up huge fees by challenging every assumption in banks’ financial models to make sure they cannot be accused of optimism. The banks are thus having to disclose ever bigger write-offs, contributing to fear of recession in America both indirectly, by delivering a stream of bad news, and directly, by constraining banks’ ability to lend.
The reduced supply of credit is contributing to recessionary fears that are greater in America than in the rest of the world, because the American consumer faces an unusual combination of difficulties, says Ian Shepherdson of High Frequency Economics, a research firm. Fuel prices are soaring, house prices are falling, confidence is plunging and there are early signs that the jobs market is weakening, he says.
So far, the evidence that the credit crisis is spreading to other industries is more in the mind than in the data. A severe recession could result in a peak rate of between 16 percent and 20 percent of annual defaults on corporate bonds, far higher than in 1991.
If so, lenders will retreat further and distressed-debt investors like Cerberus will be baying for blood. Businesses need lenders to finance their operations: they must be quaking at the prospect.