Business
Tea industry calls for ‘collaborative effort’ to resolve wage hike crisis
A proposed 70% minimum wage hike for tea plantation workers in Sri Lanka has caused widespread concern among industry stakeholders. While the goal of enhancing workers livelihoods is commendable, the Planters Association of Ceylon warns that such a drastic increase could have dire consequences for the industry, potentially harming both employers and employees, a press release said.
The release adds: ‘Sri Lanka’s tea industry is a cornerstone of the national economy, being one of the highest foreign exchange earners for the country. It encompasses 21 Regional Plantation Companies (RPCs), 427 small and medium-sized tea factories and with 500,000 Small and Medium Tea Estate Owners. However, the industry is already under significant pressure due to the highest production costs globally, making it challenging to compete in the international market. Implementing a 70% wage increase overnight would exacerbate this issue, given that Sri Lanka is already the most expensive tea producer worldwide. Additionally, tea productivity has been on the decline over recent years, compounding the industry’s struggles.
‘Roshan Rajadurai, Managing Director of Kelani Valley Plantations, Talawakelle Tea Estates PLC said, ‘While the proposed 70% wage hike for tea plantation workers is well-intentioned, it threatens to cripple the tea industry due to the already exorbitant production costs. A productivity-based pay system is a more viable solution, balancing fair compensation for workers with the economic realities of the industry, thereby safeguarding both their welfare and the industry's future”.
‘In response to these challenges, the Planters Association of Ceylon has introduced an alternative productivity-based wage scheme. This model is designed not only to safeguard the industry’s viability but also to enhance the welfare of estate workers. Based on current industry standards, employees could potentially earn a minimum of Rs. 1820/- and onwards, under this proposed structure. This approach strives to strike a balance between ensuring fair compensation for workers and acknowledging the economic constraints that impact the tea sector.
‘Most workers currently earn more than Rs. 1700, with many earning over Rs. 50,000 per month in a market-based model that benefits both the worker and the company. Expanding this model across the upcountry estate sector without state interference in increasing fixed wage costs without corresponding output compensation would be beneficial. A state-mandated 70% fixed wage increase could lead to financial ruin for many companies, resulting in job losses and negative impacts on the financial sector due to the companies' heavy borrowings.
‘The Planters Association of Ceylon is calling for a meeting with all concerned stakeholders to discuss this matter further. Such a dialogue is crucial for reaching a solution that ensures the prosperity of the tea industry and the well-being of its workers. The association has expressed its readiness to collaborate with the government to find a sustainable and mutually beneficial resolution.
‘While improving plantation workers wages is essential, it must be done without jeopardizing the industry viability. The proposed productivity-based wage scheme offers a balanced solution, ensuring both fair compensation for workers and the industry survival. It is now imperative for all stakeholders to unite, discuss, and implement a strategy that supports the long-term health and sustainability of Sri Lanka tea industry. Only through collaborative efforts can we secure a prosperous future for both the workers and the industry.’
Two groundbreaking reports launched by the Pathfinder Foundation in collaboration with the Australian Trade and Investment Commission have laid out a practical vision for Sri Lanka’s economic future, pinpointing the mineral and clean energy sectors as twin engines for sustainable growth and investment.
The reports, unveiled on December 17 in Colombo, present actionable roadmaps for project developers and technology providers, positioning Sri Lanka as an emerging frontier in the global clean energy and critical minerals supply chain.
Key content from the minerals report:
Sri Lanka’s largely underutilised mineral sector holds significant potential, with resources increasingly vital to global industries. The country boasts high-purity graphite, rare earth elements (REEs), mineral sands, and phosphate – all critical for electric vehicles, renewable energy technologies, and high-tech manufacturing.
While current mineral exports are around USD 389 million, the International Trade Centre estimates a potential of USD 778 million, with primary data suggesting the true figure could reach USD 2 billion. To capture this value, the report stresses moving beyond exporting raw materials to domestic refining and beneficiation.
A key strategic recommendation is deeper regional collaboration, particularly under the South Asian Free Trade Area (SAFTA). It highlights an opportunity for Sri Lanka to partner with India’s booming automotive and clean energy sectors, where demand for REEs and permanent magnets is soaring. This could involve upstream Indian investment in Sri Lankan REE resources or exports of rare earth oxides for India’s EV, wind, and electronics industries.
Key content from Clean Energy report:
Parallel to its mineral potential, Sri Lanka is pursuing an ambitious transition to clean energy, targeting carbon neutrality by 2050. The country’s renewable energy sector offers a diverse range of investment and trade opportunities for international stakeholders, spanning large-scale utility projects, distributed generation, and service-based collaborations.
Specific opportunities include utility-scale solar and wind projects, offshore wind resource mapping, and rooftop solar in urban corridors. There is also growing momentum for Battery Energy Storage Systems (BESS) to stabilise the grid, green hydrogen pilot plants, and the development of net-zero industrial parks powered entirely by renewables.
The reports highlight a powerful synergy: Sri Lanka’s minerals are essential for the very clean technologies it seeks to deploy. For instance, its phosphate can be used in lithium iron phosphate (LFP) batteries, while its high-purity quartz is vital for solar-grade silicon.
Australia is identified as a key partner in both sectors. Australian Mining Equipment, Technology, and Services (METS) firms can provide cutting-edge, sustainable mining technology, while Australian expertise in smart grids, BESS, and green hydrogen aligns with Sri Lanka’s long-term energy strategy.
While outlining vast potential, the reports also acknowledge challenges, including regulatory complexities, infrastructure gaps, and the need for enhanced skills development. Proposed solutions include modernising approval processes, developing a national critical minerals strategy, and fostering public-private partnerships.
The consensus from keynote speakers at the event – including Pathfinder Foundation Chairman Bernard Goonetilleke, Australian High Commissioner Matthew Duckworth, and senior representatives from academia, government, and Austrade – was clear. Their collective insight underscored the reports’ central thesis: Sri Lanka is presented with a unique, synergistic opportunity. By strategically developing its mineral wealth and accelerating its clean energy transition in tandem, the nation can attract significant foreign investment, create high-value jobs, and secure a competitive position in the Indo-Pacific’s sustainable economic future.
By Sanath Nanayakkare ✍️
The Commercial Bank of Ceylon has signed a Memorandum of Understanding with Prime Lands and Prime Land Residencies to provide up to 100% financing for customers purchasing condominium units or gated houses developed by the Prime Group, demonstrating the Bank’s unwavering commitment to empowering more Sri Lankans to achieve their dream of home ownership.
The agreement enables prospective homeowners to seamlessly access Commercial Bank’s home loan facilities with tripartite agreements involving the developer, the buyer and the Bank. As the market leader in home loans, Commercial Bank brings unmatched expertise and flexibility to borrowers seeking to invest in properties developed by one of Sri Lanka’s most trusted names in real estate.
Commenting on the partnership, S. Ganeshan, Deputy General Manager – Personal Banking at Commercial Bank said: “This agreement with Prime Lands and Prime Land Residencies creates an excellent opportunity for us to expand our housing loan portfolio while enabling more Sri Lankans to realise one of their life goals. Commercial Bank’s strong home loan offering, combined with Prime Group’s reputation as a leading developer, ensures customers benefit from both financial strength and quality of construction.”
The Prime Group, which positions itself as the leader of real estate artistry in Sri Lanka, comprises subsidiaries associated with lands, houses, finance and condominiums. With over 30 years of trust and excellence and a base of more than 300,000 customers, the Group says it is driven by its evergreen vision: ‘Committed to Creating a Better Place on Earth,’ which continues to inspire its passion to deliver homes that bring customers’ dreams to life.
Mahogany Masterpieces, a Sri Lankan luxury furniture brand, has launched the “An Ode to Grain” collection. This showcase honors mahogany’s natural beauty and the brand’s craftsmanship. The philosophy is to let the wood’s grain guide the design, creating timeless pieces that respect the material. The collection includes new architectural elements like architraves, paneling, and corbels, designed to bring lasting warmth and character to interiors.
Visitors can view the full collection at the Mahogany Masterpieces Showroom and Design Studio which is located at No. 87, Dr. Lester James Peiris Mawatha (Dickman’s Road), Colombo – 05. www.mahoganymasterpieces.com
NMRA laboratory lacks SLAB accreditation
Air quality deteriorating in Sri Lanka
Cardinal urges govt. not to weaken key socio-cultural institutions
CID probes unauthorised access to PNB’s vessel monitoring system
NBRO identifies landslide risks in 14 districts
Danger of weak drug regulation
‘Dates have the highest sugar content to fight Coronavirus’
Sunday Island 27 December – Headlines
#SundayIsland 17th December – Headlines
Sunday Island – 28th March
Sunday Island Headlines – 21 March
Sunday Island – 21st February – Headlines
-
Midweek Review5 days agoHow massive Akuregoda defence complex was built with proceeds from sale of Galle Face land to Shangri-La
-
News4 days agoPope fires broadside: ‘The Holy See won’t be a silent bystander to the grave disparities, injustices, and fundamental human rights violations’
-
News4 days agoPakistan hands over 200 tonnes of humanitarian aid to Lanka
-
News5 days agoBurnt elephant dies after delayed rescue; activists demand arrests
-
Business3 days agoUnlocking Sri Lanka’s hidden wealth: A $2 billion mineral opportunity awaits
-
Editorial5 days agoColombo Port facing strategic neglect
-
News3 days agoArmy engineers set up new Nayaru emergency bridge
-
News5 days agoSri Lanka, Romania discuss illegal recruitment, etc.