Business
Bitter Aftertaste: How a Wage Hike Could Brew Disaster for the Ceylon Tea Industry
The Ceylon tea industry, a vital component of the national economy, is under immense pressure from the proposed 700 Rupee wage increase for tea estate workers. While it is said that the intention behind the wage hike is to improve worker livelihoods, industry experts refer this as a pure political move aimed at gaining the estate worker’s vote and does next to nothing to address the real issues at hand. The potential repercussions could be catastrophic for the industry and its workforce, resulting in severe unemployment and economic instability.
Currently, the tea industry employs over one million people and significantly contributes to Sri Lanka’s GDP. However, many tea plantations already operate on razor-thin or negative margins due to fluctuating global market prices and rising production costs. Imposing a mandatory wage hike could push these plantations over the edge, leading to widespread financial distress and potential closures. Profits of a handful of companies from non-tea sources have been highlighted whereas the majority of companies are loss making. Furthermore, there was a one-time exchange gain from the dramatic currency devaluation last year. Ceylon tea already has the highest costs and the lowest productivity in the tea growing world.
The immediate concern is the financial strain this wage increase would place on the 21+ plantation companies. These businesses, particularly small to medium-sized ones, may struggle to absorb the additional costs. Faced with higher labour expenses, companies might be forced to cut costs elsewhere, potentially reducing worker benefits, delaying essential maintenance, or scaling back investments in sustainable farming practices. This could result in a decline in the quality of tea, making Ceylon tea less competitive internationally and leading to decreased sales and revenue.
The fear of industry collapse is not unfounded. If the tea industry crumbles, the ripple effects would be felt nationwide. Thousands of workers could lose their jobs, and the economic fallout could extend to other sectors, creating a significant national crisis. The proposed wage increase, while well-intentioned, risks becoming the catalyst for widespread economic hardship.
More alarmingly, the proposed wage hike could trigger a wave of unemployment. Smaller plantations that cannot afford the increased wages may be forced to downsize or shut down entirely, resulting in thousands of job losses. The very workers the wage increase aims to help could find themselves without any income, worsening poverty and economic instability in rural communities dependent on tea production.
Rather than focusing on a short-term wage increase, a more sustainable approach is needed. Comprehensive strategies should be implemented to improve worker livelihoods without jeopardizing the industry’s stability. This includes investing in worker training and development, enhancing healthcare and housing facilities and promoting sustainable agricultural practices.
While the proposed 700 Rupee wage hike is aimed at uplifting tea estate workers, the potential for industry collapse and mass unemployment cannot be ignored. It is crucial to consider the broader implications and adopt a balanced approach that ensures the long-term sustainability of the Ceylon tea industry. Without careful consideration and strategic planning, the wage increase could lead to greater economic problems, leaving workers worse off than before. After all, decisions made for one’s political gains could end up destroying one of Sri Lanka’s largest forex earners.
**This article is written by an industry analyst who prefers to remain anonymous
Gigalingua Lanka, a premier German language institute, officially launched in Colombo with a ribbon-cutting ceremony attended by distinguished guests, including Dr. Felix Neumann, German ambassador to Sri Lanka. This marks a significant milestone for Sri Lankan professionals, especially nurses, looking to expand their careers in Germany’s thriving healthcare sector.
In collaboration with its strategic partner Global Care Solutions (Pvt) Ltd – a renowned company in the foreign recruitment industry – Gigalingua Lanka offers a unique pathway for Sri Lankan nurses and apprentices to master the German language and pursue rewarding career opportunities in Germany.
Dr. Felix Neumann, the Chief Guest at the event, expressed his support for the initiative, emphasizing the importance of language education as a bridge to global career prospects. In his speech, Dr. Neumann noted, “German language is not only a means of communication, it is a gateway to global career opportunities.” He commended Gigalingua Lanka for providing valuable opportunities for Sri Lankans and addressing the critical demand for skilled workers, especially in the nursing sector in Germany.
Gigalingua Lanka is the first private institute in Sri Lanka to offer comprehensive German language training up to the B2 level, and conduct TELC exam. The institution also provides language training for apprentices, allowing them to undertake the Apprenticeship Program and contribute to the growing labor market in Germany. The collaboration between Gigalingua Lanka and Global Care Solutions is designed to meet Germany’s growing need for skilled workers, particularly in the healthcare sector.
The event was attended by a number of prominent figures, including Dr. Felix Neumann , Arthur Senanayake (chairman of IWS Holdings), Eran Wickramaratne – former MP, Chandra Schaffter – ( Founder of Janashakthi Insurance ), Dhammika Attygalle (Director Upali Group of Companies and President Automobile Association of Ceylon) Former Wing Commander Buwaneka Abeysuriya (Ex- chairman Janatha Estates Development Board).
Chairman of Global Care Solutions, Thomas Michael Kriwat, who is also chairman of the Mercmarine Group of Companies in Germany, highlighted the significance of the new training center. He said, “We are bringing world-class German occupational language training to Colombo, offering a structured, career-focused pathway for Sri Lankan professionals. By introducing TELC (The European Language Certificates) as an officially certified German language test authority, we are increasing accessibility for students seeking internationally recognized qualifications.”
At the thanksgiving speech, Dr. Rajan Sara, Managing Director of Global Care Solutions and Director of Gigalingua Lanka, outlined the critical need for foreign nurses in Germany. “Germany is facing a significant shortage of nurses, estimated to need an additional 150,000 by 2025. This is exacerbated by an aging population and increasing healthcare demands. Over 47,000 vacancies in the healthcare sector remain unfilled, making it an ideal time for Sri Lankan nurses to seize this opportunity,” Dr. Sara explained. (Gigalingua Lanka)
In keeping with its vision to consistently evolve and address accelerated business growth needs, Brown & Company PLC recently unveiled its new state-of-the-art manufacturing and warehouse facility in Katunayake. Strategically located within minutes of the Bandaranaike International Airport and the nation’s rapidly evolving highway network, the space is positioned to significantly enhance Browns’ logistical capabilities. The hub will enable seamless access to key markets across the island, further solidifying the Company’s principal role in a cross-section of industries.
The inaugural event of the Browns Group Industrial Park was attended by Ishara Nanayakkara, Chairman, Brown & Company PLC and Deputy Chairman, LOLC Holdings PLC and Kapila Jayawardene, Group Managing Director/CEO, LOLC Holdings PLC along with key officials from the Browns and LOLC Group.
Dialog Axiata PLC, Sri Lanka’s #1 connectivity provider, has successfully launched the highly anticipated vivo V50 smartphone, marking a significant milestone in its commitment to bringing 5G technology and pro-level mobile experiences to Sri Lankan customers, with the first customer handover taking place on 27th March 2025.
The vivo V50, designed in collaboration with ZEISS, combines advanced features such as a 50MP ZEISS OIS Main Camera, a powerful Snapdragon® 7 Gen 3 processor, and a stunning 6,000mAh battery, all housed in a sleek, ultra-slim design. Available at an attractive price, the vivo V50 delivers unmatched mobile performance for work, play, and creativity, offering features such as AI-enhanced photography, 4K video recording, and lightning-fast 90W FlashCharge technology. The vivo V50 also boasts a 41° golden curvature for a comfortable grip and a premium, cinematic mobile experience.
Dialog’s partnership with vivo underscores its commitment to bringing the latest in 5G innovation to Sri Lanka, providing customers with access to next-generation mobile experiences and empowering them to capture, create, and connect like never before. The vivo V50 is now available for purchase at Dialog’s Experience Centers and via https://www.dialog.lk/phones/vivo-v50-5g-12gb.
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