Islam and Fair Trade

Fair trade is Islamic trade.  "God loves those who are fair and just" (Quran 49:9).

Islam is a divine religion. It’s a complete code of conduct and a perfect way of life. The teachings of Islam not only revolve around ethics and morals that a human ought to pursue to live a good life but it also teaches the ways one should deal with other fellow human beings. Talking about trade here, Islam heavily lays emphasis on justice, fairness and honesty, tempered with human kindness while conducting trade. Fair Trade is a unique characteristic of Islam. The goal which Islam strives for in commerce is exchange of utilities among the members of the society, based on brotherhood and justice. Towards this goal, Islam has set certain regulations and principles, which control the activities of merchants. The transactions carried between seller and buyer should not be characterized by injustice or inflexibility. Either the seller should not make the rates too high or the buyer should not try to argue him out of the price which is fair and just. Both of them should be sympathetic and considerate towards each other. The Holy Prophet (PBUH) said: May God show mercy to a man who is kindly when he sells, when he buys, and when he demands his money back.

Throughout the holy Quran there are verses which point towards the ethical issues in the realm of trade “And give full measure when you measure, and weigh with a balance that is straight” (Qur’an, 17:35); “Do not withhold from the people the things that are their due and do not commit mischief in the land, causing corruption” (Qur’an, 11:85) and “Deal not unjustly, and you shall not be dealt with unjustly” (Qur’an,2:279).

The concept of fair trade aims to promote a more sustainable relationship between the buyer and seller. The social interactions in trade must not be based on color, cast, and discrimination or prejudice. All humans are equal in the eyes of Allah therefore all transactions held in trade must follow this. According to the Prophet of Islam (PBUH), “the best earnings are from a blessed sale and the product of a man’s own hands.” A sale would not be considered to be a “blessed one” if it has an element of deception or cheating of any sort in it; the character of a Muslim trader must be upheld at all times. The ultimate goal of a Muslim trader should not be to accumulate wealth and riches. His duty should be use the wealth to help the poor, pay regular zakaat, give debt to help the fellow traders etc. Some principles set by Islam for fair trade are: 1) the prices must be decided according to the law of supply and demand. If, in any event, some merchants take advantage of certain situations, then the government must intervene to ensure justice n prices. 2) The law forbids any type of monopoly and it considers it a serious crime 3) Prophet has prohibited any type of price competition, because competition only serves personal selfish ends, and causes conflicts and divisions between the merchants.

Hence, it is understood that Islam developed very wonderful trade, fifteen centuries before itself and standing as a role model for the current day’s system. Also one should note that Islam's economic development is based on the principle of solidarity, brotherhood and justice and always propagates the practice of good moral and ethical values.