Interview: Navin Dissanayake
How can mechanisation enhance plantation productivity without disrupting the traditional labour-intensive markets?
NAVIN DISSANAYAKE: The tea industry in Ceylon, particularly the large tea estates, has employed the traditional model of a labour-intensive workforce. Over the last two decades the movement of labour to more urban areas has reduced this workforce. Also the third generation of youth does not want to work in the estate in the traditional format.
At the moment there are wage agreements between estate unions and estate companies that are not related to productivity. The wage agreement that was concluded in October 2016 has, for the first time, included a limited productivity model. The agreement also contains a clause promoting the idea of a full productivity model in the next wage agreement, which comes up in two years’ time.
As far as mechanisation is concerned, we feel this has to be approached in a cautious way. The tea plantations in Sri Lanka have produced the best black tea in the world through the traditional method of high-intensity hand plucking. Ceylon tea is like French wine in that traditional methods have been used to get the best flavour and the quality. The use of mechanisation might disturb that process. So we have to ensure a slow transition to mechanisation processes that will give a higher yield but at the same time not compromise the quality of the tea.
To what extent can the promotion of new planting in non-traditional areas make up for a short-term fall in output in the wider sector?
DISSANAYAKE: The Sri Lankan tea industry has seen a substantial shift from large estates to smallholdings, which produce 73% of our teas. This shift has happened over the last two decades, and it is a positive shift that has yielded greater economic benefits for a larger portion of the population. The overall government policy is to increase new planting in the smallholder sector, and there are several programmes aimed at achieving this result The Tea Small Holdings Development Authority has a new subsidy programme to promote tea in non-traditional areas. Hence, we are giving a subsidy to smallholders who grow tea in new lands as well as in non-traditional areas. There is also a new $70m project from the International Foundation for Fair Trade and Development to promote new planting in non-traditional areas. We feel that this is a long-term solution to the fall in output from traditional areas.
To what extent can improving research and development in rubber production help increase future export revenues?
DISSANAYAKE: Sri Lanka has seen its rubber production drop drastically but at the same time it has also become a rubber export hub in Asia. This is because we have allowed international rubber companies to operate in Sri Lanka without any restrictions by adding value here, and exporting finished products like tyres and gloves. The Board of Investment mechanism has been used to enhance and promote this process.
Unfortunately, many Asian governments do not place a great deal of emphasis on research and development. However, individual companies which are involved in this process place a substantial emphasis on research and development in order to produce value-creating rubber products. The government will help to strengthen this sector by further liberalising the production of finished rubber products through the promotion of the concept of a rubber hub in Sri Lanka.
At present, the government has begun the process of implementing the Sri Lanka Rubber Master Plan, which supports the creation of a special rubber export processing zone in the country.