Growing economy darkens Sri Lanka’s tea future – Nikkei Asian Review

Nikkei  (published in July 10 NAR print edition)

Tea-plucking outside Nuwara Eliya (Photo: Simon Roughneen)

Tea-plucking outside Nuwara Eliya (Photo: Simon Roughneen)

NUWARA ELIYA, Sri Lanka — K. Sagunthaladavi, 36, has spent half her life among the waist-high bushes that cover the verdurous slopes of Sri Lanka’s tea country, plucking hundreds of thousands of the green leaves used to make one of the world’s oldest and most popular drinks.

     It is June, and the Yala monsoon is blowing, which means Sagunthaladavi is working hurriedly. “During the season I can take 30kg a day,” she said. “Off season, 18, maybe 20(kg).”

     Like most of Sri Lanka’s tea plantation workers, Sagunthaladavi is descended from migrant laborers brought by British colonialists to Sri Lanka from Tamil Nadu, in India, back when Sri Lanka was called Ceylon and was part of the British Empire.

     When those first Tamils arrived, tea growing was a novelty on what was previously a coffee island. But Sri Lanka for a time became the top exporter.

     That position has since been ceded to Kenya. Sri Lanka is now the world’s fourth biggest tea-grower, with tea in 2012 accounting for 2-3% of its gross domestic product and around 15% of its export earnings.

     Global demand for tea has grown by around 50% the past two decades. But political instability in the Middle East and North Africa has compromised some markets, and erratic weather has hit plantations. In the longer-term, worker shortages loom for the island’s tea industry as the children of today’s pickers become more educated and seek jobs in Colombo and elsewhere.

     Sagunthaladavi’s plantation, with its colonial-era name of Court Lodge, is one of 18 in Sri Lanka run by Finlays, one of the world’s biggest tea companies and a subsidiary of the U.K.-based Swire group.

     It sits in the shadow of Pidurutalagala, the island’s highest mountain at a mist-shrouded 2,524 meters. The weather here lent itself to the epithet “Little England” during colonial times and made Nuwara Eliya a popular upland haven, akin to the Cameron Highlands in Malaysia or Sapa in French-run Vietnam, where jaded colonists could refresh themselves after too much Asian heat and humidity.

     The location means that tea grown here benefits from two annual rainy periods — the May to August Yala monsoon and the turn-of-the-year Maha monsoon. This gives Court Lodge an advantage over other plantations where the weather is more fitful — and where this year, a prolonged dry season veered into drought.

Better living

Also in its favor, Court Lodge has been certified by the Rainforest Alliance, a U.S.-based conservation organization that has given its approval to 60,000 sq. km of cropland worldwide, taking in coffee, cacao, fruit, sugar, flowers, nuts, tubers and tea.

     One of the longer-standing criticisms of Sri Lanka’s tea industry regards the living conditions of workers, many of whom live in accommodations provided by their plantation’s owners. Typically, 10 or more families share common facilities, leaving each family with little more than a room to share amid cramped, unhygienic conditions.

     For a plantation to get Rainforest Alliance certification, its workers must be given more living space. “Now, on certified plantations, each family has its own house,” said Manori Gunarathne, Finlays’ sustainability manager.

Wide array

On the Madulkelle estate, a couple of hours drive from Nuwara Eliya, Ganeshan Murugan, 53, lifts a pot of manioc, also known as cassava, from a wood-fired stove in the kitchen of the two-bedroom house he shares with his wife and one of their three children. “Should be ready now,” he says, gazing into the pot. “A couple of years ago we could not cook like this.”

     As part of the certification deal, he and the other workers on the plantation were each provided with a new house. Murugan now has two bedrooms and a small garden where he grows beans and vegetables — and a postcard-pretty mountain vista.

     It is raining now in Madulkelle, but earlier in 2014, the estate was dry. No rain fell for most of the first half of the year, cutting production by about 30%, according to Sanjaya Karunaradhana, who is part of the Madulkelle management team.

     “We had a severe drought for around three months,” he said, lamenting that production would not return to normal until the end of July.

     For some tea growers, erratic weather means less tea. For others, the opposite is true. In Sri Lanka’s tea hills, a short drive can mean entering an alternate weather system. Not only does Sri Lanka’s climate widely vary, so does its terrain and altitude. As a result, Sri Lankan tea comes in a wide assortment.

Rajapaksa factor

Sri Lanka’s economy, slightly smaller than New Zealand’s when measured by GDP based on purchasing power parity, has been growing at more than 6% a year since 2002. In May, the International Monetary Fund projected economic expansion of 7% for 2014.

     Earnings from export crops such as rubber, spices and tea — and from overseas remittances, which made up around 10% of GDP in 2013 — have been supplemented by a jump in tourism and some hefty Chinese infrastructure building, including a new international airport that opened in March 2013.

     President Mahinda Rajapaksa has used this glimpse of prosperity to burnish his government’s legitimacy, otherwise tarnished by concerns about his family’s influence and by controversial moves of his own. Rajapaksa has abolished presidential term limits and dismissed the chief justice by presidential decree.

     Paikiasothy Saravanamuttu, executive director of the Center for Policy Alternatives in Colombo, and other analysts have criticized the president’s style. “There is an over-emphasis, for example, on economic development, designed, conceived and implemented from the center, (with) very little inclusiveness and participation of the people whose lives it directly affects,” Saravanamuttu said in a recent radio interview.

     Backed by China, which in 2012 announced it would lend Colombo $1.12 billion for port and railway construction, Sri Lanka’s government has brushed off the criticisms, which have also been voiced by India and other countries.

A boy studies at a day care center on a Finlays estate where his parents work. (Photo by Simon Roughneen)

     But for tea plantation workers like K. Sagunthaladavi, Sri Lanka’s growing economy means her children, now teenagers, should be able to find less-burdensome work once they complete their education. “I am toiling here,” she said, “as I want my children to be in a better life.”

     She makes a little more than $5 a day.

     Sagunthaladavi’s wish is likely to be fulfilled. A recent report on the tea industry produced by Forum for the Future, a U.K.-based nongovernmental organization working with Finlays and other tea producers, suggests that young people in tea-growing countries are increasingly likely to abandon the plantations and seek service sector jobs in the city.

     “This raises real questions about the ability of the sector to source the labor it needs for tea production in the future — and to what extent this trend will drive greater mechanization,” the report says.

     “Come five years we will be short of workers,” said Lasantha Samarakoon, plantation manager at Court Lodge. “The younger generation do not want to come to work here. They want to go to university, get other jobs.”

Some tea estates are diversifying into other crops, such as spices, coffee and rubber (Photo: Simon Roughneen)

Some tea estates are diversifying into other crops, such as spices, coffee and rubber (Photo: Simon Roughneen)


 Children learning at daycare centre/school on a Finlays estate. During school hours, parents are usually working on the tea plantations (Photo: Simon Roughneen)

Children learning at daycare centre/school on a Finlays estate. During school hours, parents are usually working on the tea plantations (Photo: Simon Roughneen)


Sorting newly-arrived tea leaves inside Finlay's Court Lodge estate

Sorting newly-arrived tea leaves inside Finlay’s Court Lodge estate


K. Sagunthaladavi at work (Photo: Simon Roughneen)

K. Sagunthaladavi at work (Photo: Simon Roughneen)

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