Business

Sri Lanka tea sector stuck in colonial-era model after 75 years of independence

Published

4 years ago

2023/02/6

Thilina Walpola

Due to lack of thrust in the direction of productivity-based revenue share model

By Sanath Nanayakkare

Regional Plantation Companies (RPCs) are encountering difficulty in planning the future of their financial viability due to the slowness of the government and the trade unions in exercising the best choice for the sustainable future of the sector, The Island Financial Review learnt at a recent press briefing called by the The Planters’ Association of Ceylon (PA).

It was revealed during the Q&A session that on the one hand there is a lack of political-will to deviate from the colonial-era daily wage model after 75 years of independence as the matter is politically sensitive to the government, and on the other hand, better earnings and flexi hours enjoyed by operators (tea pluckers) would lead to a loss of influence the trade unions have on their members.

These are seen key stumbling blocks to successfully implementing a productivity-based wages and revenue share model in Regional Plantation Companies (RPCs) which would be a win-win situation for both workers and RPCs.

Throwing numbers in good measure, RPCs pointed out that since privatization the RPCs have never been a burden on the Treasury as they were under the state control, and 22 RPCs are the only private sector stakeholders engaged in producing, processing and marketing of tea, rubber, oil palm and other crops.

RPCs account for over 450 estates, 371 factories/production units cultivating 43.36% of tea, 23.75% of rubber land and other RPC crops account for 33% of RPC land which include: coconut, oil palm, cinnamon and other crops.

According to Dr. Roshan Rajadurai, Media Spokesman of the Planters’ Association, 25%-30% of RPC tea crop is coming from the wages and revenue share model to which the operators have joined on their own volition having experienced the benefit of this system.

“These operators have used their own discretion to join the system because they can work flexible hours while taking care of their families. Others prefer to work independently and more productively without being pushed around. And there are others who have an entrepreneurial mindset in making their wages from tea plucking a second source of income. We have witnessed them taking good care of their plots and do the plucking in a sustainable way. So this system has resulted in more crop being harvested with improved leaf standards which has led to better prices and lower cost of production for the estate. Higher prices eventually result in higher revenue share for operators, but this needs to be widespread and formalized through a proper mechanism without further delay,” he said.

According to RPCs, the cost of production of a kilo of tea currently is Rs. 960 which has significantly increased due to cost of production and devaluation of our currency.

Senaka Alawattegama, Director/CEO Talawakelle Tea Estates PLC said, “We believe that the root cause of our historic economic crisis stemmed from the failure of successive governments to formulate policy based on robust stakeholder consultations. Unfortunately, we allowed cheap politics to hijack our economic policies. 100% organic fertilizer policy overnight compromised food security and plantation crops declined exponentially. Today, the trade unions are talking about 100% daily wage (Rs. 2,000 per day) as a buffer against the high inflation in line with the colonial-era daily wage model. Not only RPCs, the trade union and the government are aware that the productivity-linked wages and revenue model is the only way forward. Increasing wages in line with inflation will undermine the sustainability of RPCs. When workers are paid on how much they pluck and how much that harvest will seize at the auction, then their compensation would be in line with those dynamics. Had the authorities and trade unions implemented this system when RPC tea plantations proposed it years ago, workers would have been better off today. Instead of Rs. 1000 daily wage, workers would be receiving an average of Rs. 50, 000-60, 000 per month; and most productive workers even more than that.”

He said that RPCs have consistently advocated for reforms to the colonial era daily wage model, in favour of a productivity and revenue share model.

“Furthermore, this system will increase total export earnings with increased volumes of good quality tea available for export which would fetch higher prices. We are at a crossroads where every dollar counts. So we urge all stakeholders to fully implement this critical reform considering its multiple benefits, without procrastination,” Alawattegama, said.

RPCs urged the government and trade unions to look beyond their concerns and interests in order to ensure the sector’s continued progressive performance without letting it be another burden on the already reeling economy of the country.

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Business

SLT-MOBITEL driving Sri Lanka’s economic resilience through digital infrastructure

Published

19 hours ago

2026/09/10

Sahan Weerasooriya

SLT-MOBITEL marks its triple triumph at the National Business Excellence Awards 2026

Corporate accolades underscore the alignment between its operational excellence and national development

In an era where national competitiveness is intrinsically tied to digital connectivity, strengthening the country’s digital backbone has become an urgent priority. Within this context, the evolving role of Sri Lanka’s leading telecommunications provider, SLT-MOBITEL, offers valuable insight into how technological infrastructure can underpin broader economic resilience.

Telecommunications and digital networks are foundational to economic transformation. By expanding high-speed broadband access, upgrading enterprise cloud capabilities, and bridging the urban-rural connectivity divide, SLT-MOBITEL helps reduce business transaction costs, streamline supply chains, and enable micro, small, and medium enterprises to reach global markets.

Recent corporate accolades further underscore this alignment between operational excellence and national development. SLT-MOBITEL’s triple triumph at the National Business Excellence Awards 2026 – winning in the Infrastructure and Utilities sector, Performance Management, and ICT Services categories – highlights its growing impact. Notably, the recognition of eChannelling’s contributions to digital healthcare reflects a broader strategic pivot toward integrated technology solutions.

“Institutional efficiency of this nature is critical for attracting foreign direct investment, as global partners increasingly assess a country’s digital maturity and systemic stability before committing capital,” noted industry observers.

Moreover, the company’s transition from a conventional telecom utility to a comprehensive digital solutions provider aligns seamlessly with Sri Lanka’s national digitalisation agenda. As the country pursues public sector modernisation, enhanced e-governance, and a competitive knowledge economy, the private sector must step up to deliver secure, scalable, and future-ready networks. Investments in data centres, cybersecurity frameworks, and advanced ICT infrastructure act as strategic buffers, ensuring that Sri Lanka’s economic apparatus remains agile and resilient amid future global uncertainties.

However, industry experts caution that while these achievements are commendable, SLT-MOBITEL still has a considerable distance to cover in fully enabling a truly digital economy.

Business

Port City Colombo strengthens Gulf investment ties at Dubai diplomatic engagement

Published

19 hours ago

2026/09/10

Sahan Weerasooriya

The panel discussion at the engagement

Port City Colombo (PCC) took a prominent role as Platinum Sponsor at the second edition of Sri Lanka Beyond Your Dreams, a high-level diplomatic and investment engagement hosted by the Consulate General of Sri Lanka in Dubai and the Northern Emirates. The event, held on 2nd September 2026 at the Hilton Dubai Al Habtoor City, brought together over 400 senior UAE-based business leaders, investors, diplomats, and institutional stakeholders, alongside Sri Lanka’s most senior government representatives.

The gathering was graced by Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister of Foreign Trade, as Guest of Honour, and Vijitha Herath, Sri Lanka’s Minister of Foreign Affairs, Foreign Employment and Tourism. A high-level Sri Lankan delegation – including the Secretary to the Prime Minister, the Chairman of the Board of Investment, the Chairman of the Export Development Board, and the Director General of Commerce – underscored the government’s strong commitment to deepening economic diplomacy with the UAE.

In his keynote address, Minister Herath reaffirmed the centuries-old ties between Sri Lanka and the Arab region, emphasising the UAE’s vital role as a key economic partner. He stressed the urgency of finalising a Comprehensive Economic Partnership Agreement (CEPA) with the UAE, which would establish a robust framework to elevate trade, investment, and bilateral cooperation. Declaring Sri Lanka “open and ready for business,” he positioned Port City Colombo as the physical embodiment of this economic mission – a modern Special Economic Zone (SEZ) with a dedicated legal framework and competitive incentives, offering UAE investors a natural gateway to South Asia while maintaining strong Gulf connectivity.

Business

American Premium Water strikes Gold at Dragons of Sri Lanka 2026

Published

19 hours ago

2026/09/10

Sahan Weerasooriya

The achievements are particularly significant given that the company’s debut at the Dragons awards has resulted in four Dragons across four categories.

American Premium Water has secured four wins at Dragons of Sri Lanka Awards 2026, including three Gold Dragons and one Black Dragon, marking a significant milestone for the brand following its relaunch last year.

Part of the prestigious Dragons of Asia awards, Dragons of Sri Lanka brings the program’s regional platform to the local market, celebrating creative and effective marketing communications, with entries evaluated on strategic thinking, creativity, execution and impact. Established in 2000, Dragons of Asia is one of Asia’s premier results-driven marketing awards programs.

For American Premium Water, the achievements are particularly significant given that the company’s debut at the Dragons awards has resulted in four Dragons across four categories. In the distinction of Gold Dragons, American Premium Water was recognized across three categories including Product Launch or Re Launch, Cause, Environment or Sustainability and Creative Excellence while the Black Dragon was awarded in recognition of Small Budget.

Competing alongside leading brands and agencies in Sri Lanka, American Premium Water’s four wins demonstrate the strength and effectiveness of its recent work. Winning three Gold Dragons across three distinct categories highlights the breadth of the brand’s achievements, while the Black Dragon for Small Budget further emphasizes its ability to create meaningful impact through focused and efficient investment.