Sri Lanka’s coir industry, once a flourishing business that provided a major income to thousands of people, seems to have tied itself up in knots. The small, medium and traditional coir and coir-based industrialists in the country have complained that they are now compelled to close down their businesses owing to foreign company invasion in [...]

Business Times

Sri Lanka’s coir industry tied up in knots

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Sri Lanka’s coir industry, once a flourishing business that provided a major income to thousands of people, seems to have tied itself up in knots.

The small, medium and traditional coir and coir-based industrialists in the country have complained that they are now compelled to close down their businesses owing to foreign company invasion in joint ventures with local partners.

Foreign companies engaged in the lucrative coir-based product exports with local partners are enjoying unlimited business freedom granted to them by Sri Lanka government authorities including the line ministries and the Board of Investment (BOI), they alleged.

These companies have already acquired assets and resources of small, medium and large scale coir manufacturers who failed to survive in the stiff competition of foreign firms with modern machinery and resources, North Western Province industrialists said.

A combination of factors has brought about a steady decline in the business of local entrepreneurs, including non availability of raw material, subsequent surge in input prices, the lack of modern machinery, and failure to mechanise their manufacturing process.

Foreign companies in Sri Lanka have moved ahead with pre-crushing machines pushing local manufacturers to the wilderness, they complained adding that all necessary facilities and approvals have been given to them by the North Western Provincial Council authorities.

Although the government has launched the Enterprise Sri Lanka initiative to assist young entrepreneurs, there was no programme to encourage and help local coir industrialists, they said.

Sri Lanka has the potential to compete with countries such as India, Indonesia and Vietnam to benefit from the increase in demand of coir based products, but local industrialists have failed to take strategic steps to think out of the box and invent, a senior official of the Coconut Development Authority (CDA) told the Business Times.

These multinational companies operating in Sri Lanka wash raw coco peat with water first and calcium nitrate with water thereafter while discharging effluence to the environment causing severe water pollution in the area, several environmentalists working in the province alleged.

People and industrialists in the North Western Province have complained to the Central Environmental Authority (CEA) to take necessary action against foreign companies which are continuing this practice causing environmental and water pollution, they said.

It has been revealed that a stock of over 2000 metric tons of calcium nitrate chemical fertiliser is being imported to the country yearly and 90 per cent of it is used for coco peat washing process.

Washing the processed husk in calcium nitrate is being done to clean it of sodium and chloride and the process also removes potassium, boron and silicon in factories located in North Western Province and North Central province.

Environmentalists revealed that a Norwegian multinational firm was dumping waste water to some pits near the river contaminating ground water at Deduru Oya area in Kobeigane.

All those complaints against such companies have fallen on deaf ears, they said adding that a senior officer of the CDA has made a valiant effort to protect such foreign companies at a top level meeting recently, they pointed out.

However some companies are maintaining wastewater treatment plants in their coir factories, a spokesman of a British company said adding that the wastewater produced in the process of removing unwanted elements in the coir substrate manufacturing process should be managed properly to prevent environmental pollution.

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