Fairtrade Eastbourne

At Fairtrade EB's June meeting we were treated to a talk and presentation about the work of Shared Interest, an ethical investment co-operative that lends money to fair trade businesses in the developing world. As we learnt through the course of the presentation, the financial support they offer can really help to kick start a fair trade business and in turn help improve the lives of both producers and their communities.

Sally Reith from Shared Interest spoke for around one hour and began with the poignant message that as the world is in the grip of the 'global recession', the phrase 'tightening your belt' is no metaphor, but a literal reality for millions of producers in developing countries.

Established in 1990, Shared Interest (SI) continues to be the world's only 100% fair trade lender and has more than 8,800 members with each member having a say. It is a response to the so- called 'coyotes' who prey on vulnerable people who lack the security and trade relationships that would allow them to seek a better price. Staff at the Costa Rica office have reported local lenders offering loans of 40% interest!

In it's 20 years the co-operative has only a 2% default rate. This is from people who are often considered 'too risky' to invest with!!! It goes to show that producer groups and farmers in the developing world just need the opportunity to prosper, 'a hand up, not a hand out.'

From their first office in Newcastle, UK, Shared Interest has grown to have offices in Peru, Kenya and Costa Rica and now have ambitions to move into Asia. SI aims to be accessible to both producers and investors. The money generated from the interest rate on loans is 'recycled' back into the SI coffers and in turn more people to benefit. All loans are subject to approval and aim to help those that could use the funding the most, mainly as an initial start-up or to fund new business ventures etc. To allow credibility for lending a business must be Fairtrade certified.

The co-operative also have a charity arm called the Shared Interest Foundation. Through this some organisations can receive grants for training, facilities and other forms of help to get businesses off the ground. They also try and provide much needed funding for vulnerable or struggling businesses and producer groups in the event of shocks such as market collapses and crop failures. For example, Zimbabwe in recent years has had producers helped by the SI Foundation to try and cope with the effects of challenges the country is facing.

Case Study 1: Canaan Fair Trade

Based in Jenin, Palestine, Canaan sells olive oil and other delicacies produced by over 1,700 small farmers organized in informal cooperatives and represented by the Palestine Fair Trade Association (PFTA). It was established in 2004 and uses the fair trade concept to empower marginalized Palestinian rural communities caught in conflict so they can sustain their livelihoods and culture.

In 2008 Canaan FT took out a loan with Shared Interest to part finance new storage and bottling facilities. The loan was for $635,000 which was repayable over 5 years. As well as this a further $100,000 was lent to enable the production of goods in advance of receiving the first payments from the buyers, allowing for the transition and the business to develop. After a query from a member of the audience, it was clarified that this $100,000 was separate from the Fairtrade Social Premium - the extra sum paid on each FT certified product which goes into social and community projects.

Case Study 2: Bega Kwa Bega- (BkB)

The group were also treated to a short film about Bega Kwa Bega- (BkB), a co-operative society based in the Korogocho slum district of Nairobi, Kenya. The name translates as 'Shoulder To Shoulder' from Kiswahili. It was set up in 1991 under the umbrella of the local Catholic church. It's aim is to rehabilitate girls and women who have lived on the streets or been subject to abuse or exploitation as a result of the extreme poverty found in the area, where millions live on less than $1 US a day.

The products coming out of BkB are mainly handicrafts such as baskets and jewellery. The project Coordinator, Ignatius Joseph spoke about how through SI's support they have been able to buy new sewing machines and office equipment and expand the business to allow more people to benefit. He also spoke of how the trust and commitment through an open and transparent system is empowering people in the community- 'everyone is involved'. The co-op put 20% of their annual profits back into community projects.

To watch the video as well as others by Shared Interest, please click HERE

Membership
Members include individuals, schools, businesses and faith groups and the money that they have invested is used to support member co-operatives and producers throughout the developing world.

How can we get involved?

You could invest some money, donate to the SI Foundation, volunteer to spread the word or become an advocate or ambassador for the work of Shared Interest. Investors come from all sections of the community, from Churches and Synagogues to a school tuck shop which, as Sally Reith pointed out, is a particularly nice idea as children are learning first hand about how trade can really be beneficial to everyone when conducted in a fair and just manner.