Business Times

Call to revamp plantation industry, social conditions

By Bandula Sirimanna

The plantation industry needs to be quickly improved – particularly replanting - especially since it’s over 100 years old tea with the introduction of new technology and with this in mind, the government has introduced a National Plantation Industry Policy (NPIP) framework, according to the Minister of Plantation Industries D.M. Jayaratne.

He said more funds will be allocated in the 2010 budget for the development of this sector and all state-owned plantation companies will be directed to implement replanting programmes in stages without affecting tea output. Measures will be taken to increase investment in human, financial, physical, natural and social capital. However, he added, that the country’s tea production has been badly hit by the present drought and the drying up of reservoirs in the hills.

Plantations: Is Sri Lanka on the right track?

Plantation is Sri Lanka’s biggest asset and tea its biggest commodity export.

Thousands of hectares of tea and rubber were created by the British from nothing and since then there have been many changes among which were the nationalisation of the estates and subsequently, the privatisation of management of these properties.

Diversification of the tea industry in particular has seen companies producing exotic tea, organic tea or developing a product that matches the international standards of good governance, accountability and a decent environment for workers. Tea bungalows are now the fad in the tourism industry where these beautifully, crafted homes for senior planters have been turned into mini boutique hotels.

However Sri Lanka lost its eminent position as the world’s largest tea exporter Kenya last year, prompting the Business Times (BT) to take a look at the industry and analyse its current status. In this study, BT reporters spoke to a cross section of the industry including politicians, government officials, brokers, unions and workers. This is their story:

UNP MP Ravi Karunanayake said that the government has failed in finding solutions to burning problems of workers in the plantation sector. He added that the government has no policy at all to revamp the industry, and it should take the responsibility for pushing the world’s number one tea export industry to the second place behind Kenya.

He noted that the cost of production which is currently the highest in the world, should be sensibly controlled to make Sri Lankan plantations industry competive in the world market. He warned that if the plantations or producers become non-viable, the industry in which the livelihood of about 10 % of the country's population depends will be at risk leading to socio-economic problems.

Dr. Wickremabahu Karunaratne, leader of the New Left Front, said that the plantation industry especially tea, is facing a severe crisis today amidst the rejection of the workers demand to increase their daily wages up to Rs.500. He anticipated worker unrest soon in the plantation sector due to the attitude of the government as well as employers towards the employees. He noted that his party’s position is that all state owned tea estates now managed by private companies should be divided into one or two-acre blocks and its management handed over to cooperative societies or smallholders under the supervision of the government.

He added that this industry cannot be maintained properly if Sri Lanka continues to follow the system adopted by the British rulers confining workers to line rooms and depriving them of their basic human rights. He noted that the government has slashed the financial allocations for plantations and it has also failed to utilize the revenue derived from cess for the benefit of the industry.

D.E.W. Gunasekera, Minister and General Secretary of the Communist Party said that the productivity in Sri Lanka’s plantation sector is not satisfactory as some companies are not managing the these estates properly. They are engaged in felling of trees, gemming and leasing out blocks of land belonging to estates illegally rather than improving plantations. This is a very sad situation and remedial action should be taken, he said. He added that a cabinet sub committee chaired by him has made recommendations on land reforms in the plantation sector and it will be implemented by the new UPFA government after the elections. He commended the achievement of tea smallholders who are responsible for around 70 % of the country’s production.

JVP Propaganda Secretary Vijitha Herath was of the view that the government’s intervention is essential to maintain the plantation sector at a high level. Although this sector contributed much to the economy the state of the plantations in terms of development is unsatisfactory, he said. It faces low productivity and high cost of production and low profitability when compared to other countries.

These and other factors were the main reasons for the poor social condition of the estates, rigidities in the labour market, etc. Further, the sector also faces looming labour shortages due to out-migration with high marginal value for labour, such as wages, offered by other manufacturing and service sectors, voluntary unemployment stemming from poor living and working conditions of plantation workers, and ageing workforce.

He said that the government should be able to identify these problems and take remedial action. Without resorting to finding solutions, this government is promoting low quality tea producers who are mixing tea dust and ferrous sulphate with black tea to increase volumes taking advantage of political patronage, he said.

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