Free Trade, Fair

Ma. Corazon Dy Reyes

In passing, fair trade and free trade sound interchangeable. However, free trade and fair
trade are not the same thing for farmers and producers in the Global South. It is critical
to comprehend both. Free trade advocates for fewer borders, limitations, and taxes on
products and services moving between countries and continents. Meanwhile, fair trade
entails ensuring that the employees who produce these goods and services are fairly
treated and that human rights are upheld along the supply chain.

Free trade is fair because it is a win-win situation that allows nations to focus on their
core competencies, competitive advantages, enhancing economic production and
encouraging income development for its citizens. Free trade benefits corporations eager
to grow, but it does not protect workers' rights or attempt to improve working conditions.
Instead, free trade strives to remove wage inequalities (imbalances) between countries.
During the manufacturing and transportation of commodities to multiple nations, free
trade provides the fewest checks and balances (such as labor regulations, etc.) The low
price of items passed down to you is owing to the lack of pricing minimums and low
labor wage requirements. Worker protection (such as a living wage and sufficient safety
requirements) is likewise non-existent throughout the supply chain.
Adam Smith's theory that the division of labor across countries leads to specialization,
greater efficiency, and higher aggregate production underlies the theoretical case for
free trade. Trade restrictions may have practical advantages from the perspective of a
single country, particularly if the country is the primary buyer or seller of a product. In
practice, however, the protection of local businesses may benefit just a tiny percentage
of the people while harming the majority.
Finally, when people all over the globe are given the ability to lift themselves out of
poverty, they may participate in the global economic system of buying and selling
products and services. Free trade favors keeping consumer costs as low as feasible.
However, without the supply chain checks and balances that exist in a fair trade system,
these low costs come at a cost to the workers.