In an earlier news item we saw that the global recession has hit the demand for organic produce. The same is not true for Fairtrade products as a global survey published on 17/4/09 shows (see). Awareness of Fairtrade products continues to grow as do sales. The articles below look at the findings of this survey and at the explanations behind it.
UK: Fairtrade Flows Against Economic Tide Namnews (20/4/09)
The government must act on fair trade now Public Service Review: International Development Issue 13 (20/4/09)
Fairtrade a hit with shoppers as demand rises despite credit crunch Glasgow Daily Record (17/4/09)
Link to short videos from the Fairtrade Foundation; Link to facts and figures on Fairtrade Fairtrade Foundation
Questions
- Consider the reasons why Fairtrade sales have increased while sales of organic produce have declined.
- Does purchasing Fairtrade products mean that consumers are not seeking to maximise their consumer surplus?
- What economic challenges face Fairtrade producers? How should governments help the Fairtrade movement?
- Is the liberalisation of trade in the interests of Fairtrade producers?
The Koruna (or crown) was the national currency of Slovakia. This may not be something you knew until you read it just now and you might as well forget the fact straight away. This is because the Koruna ceased to exist at midnight on December 31st 2008 when Slovakia became the 16th member of the eurozone. The official conversion rate between the Koruna and the euro has been advertised extensively in Slovakia and is 30.126. Slovakians now have to get used to a complete change in their notes and coins as euro notes and coins became legal tender on January 1st 2009. So what will be the impact for Slovakia of joining the eurozone?
Slovakia becomes eurozone member BBC News Online (1/1/09)
Slovakia embraces the euro BBC News Online (31/12/08)
Slovakia joins eurozone in new year Times Online (30/12/08)
Slovakia adopts the euro on January 1 Times Online (29/12/08)
Questions
- Examine the likely impact on the Slovakian economy of joining the euro at a time of global downturn.
- Explain three factors that the Slovakian authorities would have needed to consider when setting the conversion rate for the Koruna to the euro.
- Discuss the advantages and disadvantages to Slovakia of joining the eurozone.
A recent report from the World Bank has suggested that developing countries need to grow significantly if they are to avoid high levels of poverty. The report suggested that without rapid and sustained growth up to 4 billion people could be living in abject poverty by 2050.
‘Choose growth or accept poverty for billions’ Guardian (22/5/08)
The Doha dilemma The Economist (29/5/08)
Questions
1. |
Summarise the main findings of the World Bank report. |
2. |
Is rapid economic growth (a) a necessary condition and/or (b) a sufficient condition for alleviating poverty in developing countries. |
3. |
Evaluate two policies that a developing country could adopt to raise levels of economic growth. |
The market for rice has been in turmoil recently with shortages and rapid price rises. This crisis has led to Japan and the USA negotiating a deal to release the surplus rice held by Japan in silos. It is estimated that this deal would lead to around 1.5 million tonnes of rice being made available and this could help reduce the price of rice on global markets.
Japan’s silos key to relieving rice shortage Times Online (17/5/08)
Tokyo stockpiles rice while others go short Times Online (17/5/08)
Thai cartel idea outrages consumers Times Online (3/5/08)
Controlling crops goes against the grain Times Online (3/5/08)
Questions
1. |
Explain why Japan is holding surplus rice in silos. |
2. |
Assess the impact of this ‘distortion’ on the global rice market. |
3. |
With reference to the last two articles linked above, assess the likely impact of the cartel proposed by the Thai prime minister on the global market for rice. |
Large areas of land in the former Soviet Union and Eastern Europe are lying uncultivated due to export barriers and tariffs. Given the recent rapid rise in food prices, this fallow land (estimated to be around 23 million hectares) could help to reduce upward pressure on food prices.
Bread basket that is left to grow weeds Times Online (12/3/08)
Questions
1. |
Identify three different forms of protectionism. |
2. |
Explain why the land identified in the article has remained uncultivated. |
3. |
Discuss the arguments for and against these countries reducing tariffs on food.
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