US embassy cable - 05PARIS4871

UNCLAS SECTION 01 OF 02 PARIS 004871 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EB/TPP AND EUR/WE 
 
STATE PASS USTR 
 
E.O. 12958: N/A 
TAGS: ETRD, ECON, BEXP, FR 
SUBJECT: "FAIR TRADE" EXPERIENCES RAPID GROWTH IN FRANCE, 
GARNERS GOF SUPPORT 
 
 
1. (SBU) Summary.  Despite a slow start, the idea of "fair 
trade" and "fair trade" products is rapidly growing in 
popularity and sales in France.  Although not as advanced as 
in the rest of Europe, awareness has increased greatly due 
to efforts by NGOs, the private sector, and not least, the 
French government.  Although formerly confined to coffee, 
tea, and bananas, the range of "fair trade" products is 
expanding.  Several large "fair trade" brands are sold in 
major supermarkets alongside regular merchandise.  The 
French government is active in its support of "fair trade", 
with a government-chaired commission working to establish a 
French "fair trade" label, or appellation.  GOF action to 
organize "fair trade" domestically may pave the way for a 
likely EU standard and possible WTO exemption status.  End 
summary. 
 
FAIR TRADE IN FRANCE 
--------------------- 
 
2. (SBU) Despite a recent surge in popularity, "fair trade" 
(items which seek to give primary producers - like coffee 
growers and banana growers - a "fair" price for their 
products usually by cutting out middlemen and extensive 
marketing) only accounts for 0.1% of European trade with 
underdeveloped nations. This market is even less developed 
in France than in the rest of Europe.  French consumers 
devote an average of 0.64 euros per year on fair trade 
products, compared with average yearly spending of 2.26 
euros (UK) and 14 euros (Switzerland) per consumer. 
Regarding products with fair trade labels as a subset of all 
fair trade products, French consumers spend approximately 
0.2 centimes per consumer each year, lagging far behind the 
average of 6.75 euros spent annually by the average Swiss 
consumer.  To promote awareness of fair trade, Max Havelaar 
France began a campaign in May 2002 asking 500 cities or 
metropolitan areas to officially support fair trade. 
 
3. (SBU) Sales of fair trade products are now rapidly 
progressing in France.  Despite the small proportion of fair 
trade sales (1% of total retail trade), the movement is 
accelerating.  According to a February 2004 survey conducted 
by IPSOS for the Max Havelaar enterprise, 56% of French 
consumers had heard of the fair trade movement compared to 
9% four years ago.  Of the French consumers familiar with 
fair trade, one-third have bought fair trade goods-- 
signifying that approximately 20% of the population has 
participated in fair trade.  Accordingly, Max Havelaar 
France reports a rapid consummation increase in volume of 
fair trade products, jumping from 3900 tons to 8400 tons. 
Food products (especially coffee, tea, cocoa and bananas) 
constitute approximately 60% of fair trade purchases, with 
coffee sales comprising one-half of this revenue.  Fair 
trade has expanded to include crafts and industrial goods 
(such as pottery, clothing/cotton and even soccer balls). 
Between 2003 and 2004 French spending on fair trade products 
nearly doubled.  This rapid growth in sales seems to 
indicate a steeply growing demand for fair trade products 
making France a leader in fair trade commerce growth. 
 
 
PRIVATE SECTOR ACTORS 
---------------------- 
 
4. (SBU) The increased sales of fair trade products in 
France may be attributed to their recent availability in 
conventional retail outlets as opposed to specialized fair 
trade boutiques and distributors (such as Artisans du Monde, 
Solidar'Monde or Andines) that operate on a smaller scale. 
Notably, super stores such as Leclerc, Carrefour, Monoprix, 
Cora and Auchan now stock fair trade products alongside 
their normal stock.  These super stores continue to expand 
their fair trade product selection and anticipate steep sale 
increases in this area.  Leclerc reported 9.2 million euros 
in sales of fair trade products in 2004 with a prediction of 
15 million in sales for 2005. 
 
5. (SBU) Other players in fair trade industry are the NGOs 
and distributors who make fair trade their primary activity. 
These include associations and "labeling" enterprises that 
not only distribute fair trade items, but also promote them 
through awareness campaigns.  Among the principal "commerce 
equitable" names are Max Havelaar, Alter Eco and 
BioEquitable labels.  Some super stores have even 
implemented their own fair trade certification mark.  In 
many respects, fair trade has come to be a niche market for 
such enterprises. 
 
6. (SBU) In the sphere of civil society, many associations 
promote fair trade.  The primary French fair trade NGOs are 
Max Havelaar France and Plate Forme Francaise du Commerce 
Equitable.  Max Havelaar represents the original fair trade 
certification program, begun in the Netherlands, but has 
since been exported to neighboring countries.  The Plate 
Forme Francaise du Commerce Equitable in particular works 
closely with government officials to implement support 
programs for fair trade.  At the instigation of the Plate 
Forme, the first two weeks of May have been designated the 
"Quinzaine du Commerce Equitable".  This annual event began 
in 2001 and continues to mobilize all actors within the fair 
trade system to educate the public on this type of commerce. 
 
GOVERNMENT PARTICIPATION 
------------------------ 
 
7. (SBU) The French government seems eager to embrace and 
regulate the fair trade industry.  After two years of fair 
trade discussions by the Association Francaise de 
Normalisation (AFNOR), the negotiations failed to produce 
any consensus on key concerns among the major players in 
fair trade.  The principal challenges facing fair trade 
include durability of this trend, consumer access to fair 
trade products and legitimacy of fair trade labels. 
8. (SBU) In May 2005 National Assembly Deputy Antoine Herth 
submitted a report to then-Prime Minister Raffarin 
containing 40 propositions to support the development of 
fair trade in France.  The report outlines a series of 
criteria and controls to create a unified system of fair 
trade regulating the current multiplicity of fair trade 
labels.  After reception of the Herth report, former Prime 
Minister Raffarin charged Minister of the Public Sector and 
Small Business Christian Jacob with the re-creation of a 
national commission on fair trade. Under the auspices of 
AFNOR, this commission (led by the interministerial 
delegation for social innovation and a social economy) has 
undertaken the task of codifying the criteria of fair trade 
exchanges to serve as a general reference.  Their 
conclusions are expected by the end of July 2005. 
9. (SBU) The main objective of this commission is the 
creation of a French national label designating authentic 
fair trade goods.  Such a consensus would assign the role of 
"fair trade referee" to the GOF; all other fair trade labels 
would be submitted to standard French criteria in order to 
obtain the national certification mark.  Thus the GOF would 
create a national code of conduct and validation system for 
fair trade comparable to French AOC labels.  Minister Jacob 
hopes to have such a system for fair trade put in place 
during 2006. 
 
COMMENT 
-------- 
10. (SBU) Instead of waiting years for international 
agreement, the GOF has decided to produce a national 
standard for fair trade.  The creation of a French norm on 
the subject of fair trade is viewed as a first step towards 
a European norm.  Once such a norm is established, which 
could be a number of years, observers see the EU seeking a 
possible WTO status, allowing fair trade items to be 
provided "special and different treatment." 
 
STAPLETON