The Colonial administration, plantation community and successive Governments have taken many a measure to maintain and upgrade the tea industry since James Taylor planted the first 19 acres of tea in Loolecondra Estate near Kandy. Sri Lanka currently produces 8 per cent of the global tea production having reached the position of the second largest [...]

The Sundaytimes Sri Lanka

Ceylon Tea should be promoted as king of beverages


The Colonial administration, plantation community and successive Governments have taken many a measure to maintain and upgrade the tea industry since James Taylor planted the first 19 acres of tea in Loolecondra Estate near Kandy. Sri Lanka currently produces 8 per cent of the global tea production having reached the position of the second largest tea exporter in the world.

The tea industry plays a crucial role in the economy with its contribution to employment, export earnings and overall national product. It is reported that the Tea Exporters Association (TEA) is lobbying to establish a Tea Hub in Sri Lanka. I guess that this idea is mooted after Dubai’s initiative to establish a Tea Hub. TEA argues that “The government has plans to increase the current $11 billion exports to $20 billion by 2020. That means tea, as the country’s highest foreign exchange earning crop, has to hit a $5 billion mark. In 2011, tea exports earned $1.5 billion and it would be impossible to nearly triple the earnings in eight years to meet the government target. Tea imports should be liberalized to expand the industry and make it into a tea hub by blending high quality tea from China, India and Kenya. Sri Lanka has the world’s largest tea auction and sells the highest priced tea and is the best place for a tea hub.” TEA insists that liberalization of tea imports would not have negative impact for Pure Ceylon Tea.

The opposition of the tea industry to a Tea Hub in Sri Lanka is in the public domain. The tea industry has put forward several counter arguments. I am neither a tea exporter nor a producer. My association with tea is only as a consumer except for the fact that I spent my childhood days on a tea estate in Kandy. The fresh smell of tea leaves and the beauty of the hills still remain in my memory. This may not qualify me to speak of a highly technical subject like the “Tea Hub”. Yet, being a Sri Lankan, I believe that I have a right. It is a fact that Sri Lanka is no longer the number one tea exporter. Tea industry faces many difficulties. Rising cost of production, declining productivity, management challenges, labour shortage are only a few to be mentioned. In this light it is doubtful whether the tea industry could achieve the export targets of the government. But, is the Tea Hub going to be the answer? Tea remains a main crop which brings income and glory to Sri Lanka. Sri Lanka is world renowned for its high quality teas. Tea cultivation is scientifically managed and the industry skillfully produces the world’s finest, fragrant blends ensuring consistency in the flavour, aroma and colour of pure Ceylon tea. I was fortunate to be in the audience of Jairam Ramesh, Minister of Rural Development, Drinking Water and Sanitation, India at the Bandaranaike Centre for International Studies a few weeks back. He opened his presentation by referring to Ceylon tea. He mentioned that a Sri Lankan Minister had offered him a cup of pure Ceylon tea. Since then he has not tasted tea from any other country. That includes his own country. Do we need more proof for quality of our own tea? Currently the UAE is used as a platform and storage for the distribution and publicity in the orbit of the Middle East. Dubai in the UAE is one of the busiest harbours and a tiger economy which is active and modern as any other in the world. Dubai is growing fast and may be nearing the zenith. It is already a major trading hub. Dubai can afford to make a significant investment in infrastructure development required to establish a Tea Hub. Sri Lanka will take some time to build and upgrade such infrastructure required by a Tea Hub. Further, Dubai is not a tea producing country. Consequently it has no vested interest or preference in tea produced in any country. It, therefore, can afford to blend, mix and trade tea produced in any country. In contrast, Sri Lanka is a major tea producer. It has a vested interest in protecting and promoting its industry. This is, in my opinion, the basic difference in trading and producing. A Tea Hub in Sri Lanka will lead to conflicts between tea producers and tea exporters.

The Tea Hub might increase export earnings but the imports will rise as well. Net value addition to employment, to export earnings and to GDP will be certainly much lower. There is no guarantee or control over the quality and quantity of tea imports. It might lead to a foreign exchange drain and further widening the trade deficit. Sri Lanka for several centuries has earned the title of “Granary of the East”. The country has prospered as a successful agriculture producer throughout its history. Sri Lanka has not been referred to as a trading nation. This explains the reason behind the arrival of many visitors from both east and west in the country from time immemorial. The Chinese, Indians, Arabs, Europeans are a few to mention. They all came for trade. Sri Lanka which is blessed by its favourable agro-climatic conditions was able to produce diverse tradable agriculture commodities which were in demand. Not being a trading nation, Sri Lanka nevertheless failed to sell the surplus to the outside world. This would have paved the way for other nationals to trade our agriculture produce. The story of tea cannot be different. British planters taking advantage of favourable agro-climatic conditions introduced tea to quench their thirst. We have miserably failed in making a sustainable and viable solution to the problems in the domestic market. At the end of every cropping season we hear the cries and howls of hundreds and thousands of agriculture producers over their difficulties in finding a market. Marketing of paddy, vegetables, and fruits is no longer a temporary or seasonal issue. It has become a perennial problem. We have not been able to provide a permanent solution. How sensible is it to imagine that we would succeed in the tea export trade through a Tea Hub where we have failed in domestic trade? Let us use these wishful thinking and skills to put our house in order first. I believe we can gain invaluable experience to establish a Tea Hub if the proponents can get themselves involved in arranging improved marketing, processing and storage facilities to our farmers. Sri Lankan origin tea is rich in aroma and taste but it tends to lose its competitive edge in the world market due to the high cost of production. There are many organizations and programmes to promote production of tea such as Tea Smallholdings Authority, Tea Board, Tea Research Institute, Janawasama, State Plantations Corp and donor-funded projects in addition to a couple of ministries. They are fully equipped with technology and resources. They should come out with formulas to improve the cost efficiency and the productivity of tea production. Sri Lanka should promote high quality, high priced tea exports. Sri Lanka should compete in quality and exclusivity rather than price and mixing with cheap imported tea. If Rolls-Royce is the king of the road, Ceylon Tea should be the king of beverages. Rolls- Royce does not go to mix with cheaper automobiles to bring down its price and to increase its market share. For more than a century, Rolls-Royce has been building luxury cars for the rich and famous. One of the most expensive cars in the world, Rolls Royce symbolizes class, royalty, pride, status, elegance thus making its owner unique.

May I be permitted to quote from visionary thinking of leading automobile manufacturers in the world: DaimlerChrysler’s strategy includes: Global presence, Strong Brands, Broad product range, and Technology leadership The Toyota Motor Company slogan is “Good thinking means good products”,
Ford’s strategy is “Our vision for the future is simple: We want to build great products, a strong business, and a better world. And to become the world’s leading consumer company for automotive products and services”. Where are we in this new millennium? We are struggling with a concept of a Tea Hub that will eventually dilute the quality of Ceylon tea. In this fast globalizing scenario we must be able to stand erect in a fully open[ed] space while enjoying the benefit of fragrant winds blowing around us rather than getting swayed away. I am not sure what the views of the Tea Board are on establishing a Tea Hub. The vision of the Board is “To be the leading authority to the tea industry in promoting Ceylon Tea to become number one in the international beverage market”. Among the six services mentioned, no reference is made to tea imports. Accordingly, the Tea Board rather than acquiescing in should vehemently oppose the concept of Tea Hub. We must understand the message behind the Dubai Tea Hub. Tea has come to stay as a prominent beverage. Tea is going to be the most consumed liquid of mankind next to water. We should not hold the wrong end of the stick and attempt to beat or follow Dubai and establish a Tea Hub in Sri Lanka. Since tea is going to reign among the beverages, Sri Lanka should try to produce the world best’s pure Ceylon Tea and gain access to exclusive niche markets and re-gain its lost glory. Our attempt should be to bring Ceylon Tea back on the Tables –I mean Statistical Tables, Dining Tables and the Conference Tables.

Finally as we all know the Treasury is investing local and donor funds heavily to enhance Sri Lankan tea production. The Treasury is also trying hard to mitigate trade deficit by promoting exports and discouraging imports. In such a scenario, we have to be cautious of finalising a hasty decision to seize a tentative opportunity. We have to choose between coffee drinking exporters’ move and tea drinking tea producers’ move. Obviously the option should be introducing more tea breaks in our agendas in place of coffee breaks.

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