Ceylon tea will route Apparel success

At the inaugural evening cocktail of the 20th Global Session of the FAO – Inter Government Group on Tea hosted by the Sri Lanka Tea Board last night, the guest speaker  Rohantha Athukorala – who heads National Portfolio Development for Sri Lanka and Maldives of the United Nations Office For Project Services (UNOPS) said that Ceylon tea can be viewed as emulating the success route of the 3.8 billion dollar apparel industry of Sri Lanka and the results will be seen in the years to come even though the two industries work on a totally different business dynamic environment.    

Athukorala who was the eighth Chairman of the Sri Lanka Export Development Board and the pivotal policy making body The National Council For Economic Development(NCED) under the Presidential Secretariat, tracked back to the apparel industry that began  operations in the early 80’s  and at that was termed  mere contract manufacturers and some even used to refer to the industry as tailors but, thereafter with some strategic thinking by the Industry, it gave leadership to the world by making Sri Lanka the fashion apparel of the world for Ethically manufactured clothing.  This has given teeth to the industry in competing with price savvy merchandise coming in from Cambodia, China and Bangladesh and must be complimented said Athukorala. Today this noble industry is targeting a 5 billion dollars plus in export revenue by making Sri Lanka an apparel hub in Asia for R&D, technology sharing for fast fashion which is a case study to the world opinioned the Guest Speaker at last evening’s function to the eighty global delegates from over sixty countries and the cream of the Tea industry at Cinnamon Grand.

Then focusing on Ceylon tea he showed how the tea industry of Sri Lanka with strong leadership is slowly but surely taking the same route with the recent award of Sri Lanka being the first ozone friendly certified tea producing nation of the world.

Athukorala then tracked back and showed to the eminent gathering on how Ceylon tea has carved out the current strong position globally with some key strategic moves in the last thirty years even with all the challenges that a commodity can be up against.

Starting from the times that the plantation industry was nationalised in the 1970’s when it came under government control it went on in the 1980’s to make a bold decision to make the Colombo auction control the global demand chain by breaking away from the great London auction system which has held ground for many years.

The Colombo Stock Exchange commanding the highest values for tea globally is a testimony that this decision was correct said Athukorala.

Thereafter in the 1990’s the supply chain was privatised to management company’s which gave the opportunity for new thinking to be introduced to the industry with strong R&D power and capital infusion that resulted in Sri Lanka demonstrating the best performing country globally for value addition tea at commanding 43% said the speaker which again was a strong move by the industry.

Today, we see that Ceylon tea has taken the high ground with some focused decisions on conforming to global standards on MRL levels and has gone further by developing a new standard for Tea that has resulted in Ceylon tea being the first certified ozone friendly tea globally that no other tea producer has received which the industry must be complimented for said Athukorala.

Given that tea in classified globally as a food/beverage, the ozone friendly proposition makes Ceylon tea cut above the rest even though there are many challenges for the local Industry with catapulting cost of production (COP) that needs to be managed.

Hence we see the similarity between the Apparel and Tea Industry even though the industry dynamics are totally different he said.

May be now, Sri Lanka needs to give leadership to the supply chain sustainability give that the wage increase between the time period of 1991-2011 is a staggering 986% said Athukorala given that Sri Lanka’s daily wage rate is 137% of the average auction price in the last year whilst the other producing nations like India is at 93% and Kenya at a healthy 79%.  

What the country requires now is strengthen the demand chain by launching the Ceylon Tea campaign under the ethically manufactured proposition, whilst the ozone friendly badge supporting this claim will give teeth to the campaign said Athukorala.

Which once again makes Sri Lanka giving leadership to the world on the ethically manufactured route just like the apparel industry of Sri Lanka voiced Athukorala.

May be the theme activities like Rain Forest alliances must be pursued given that Ceylon Tea must cut away from the price savvy multi origin teas that is creating many challenges in key markets like Russia said the speaker.   The 20th Sessions of the Intergovernmental Group on Tea commences on 30 January and goes on till the 1 February.

(The  Hindu Business Line)