Call for transform lost opportunity in palm oil into lucrative industry

From left: Haritha Derana Smallholder Association President Nimal Wijesinghe, POIASL Chief Operating Officer Yajith De Silva, POIASL Ex-Co Member Emeritus Prof. Asoka Nugawela, Solidaridad Asia Managing Director Dr. Shatadru Chattopadhayay and APOA Secretary General Dr. Suresh Motwani – Pic by Ruwan Walpola

Top associations recently emphasised Sri Lanka’s latent potential for palm oil production and the possible advantages to the economy and society at large that may result from this burgeoning, lucrative, and sustainable industry.

In a joint media briefing organised by the Asian Palm Oil Alliance, a multilateral body representing the industry in Asia, Solidaridad, a global network that supports smallholder farmers and workers, and the Palm Oil Industry Association of Sri Lanka asserted the need to capitalise on the opportunities that oil palm cultivation presents.

It was pointed out that with over Rs. 11 billion in direct and indirect contributions to Sri Lanka’s GDP, the oil palm plantation and milling sectors play a pivotal role in the economic landscape. Around 60% of this economic impact stems from the plantations, while the remaining 40% arises from the milling sector. 

These sectors create over 5,000 employment opportunities, supporting the livelihoods of around 21,000 individuals. As a result of the high-value crop and outsized demand for palm oil, the industry also has the potential to generate high-income employment, with an average monthly income of Rs. 185,000 per employee. 

“This is significantly higher, in many instances by a factor of two, when compared with workers involved in tea, rubber, coconut and other plantations,” they pointed out.

POIASL ExCo Member Emeritus Professor Asoka Nugawela said: “It is crucial to thoroughly evaluate the economic benefits associated with oil palm cultivation, along with its present and potential future contributions to GDP, rural development and alleviation of poverty. Instead of misguided policies, without proper assessment, we should consider the positive impact palm oil can have on our nation’s sustainable development.”

It was also noted the POIASL proposed a range of key steps for Sri Lanka to take which include the immediate need for comprehensive stakeholder collaboration and cooperation, including; government, industry and local communities, towards the establishment of a comprehensive framework for sustainable cultivation of oil palms. 

“Our regional peers exemplify the positive outcomes of sustainable palm oil production. Malaysia and Indonesia, for instance, have successfully harnessed the potential of this crop, not only in terms of economic growth but also to establish sustainable, environmentally-responsible supply and value chains, empowering rural communities. We can fast track our success using these established and proven practices to ensure that oil palm cultivation in Sri Lanka is sustainable and in alignment with the UN’s sustainable development goals,” APOA Secretary General Dr. Suresh Motwani said.

The present legal and regulatory impediments to cultivating oil palms stand as a lost opportunity for Sri Lanka. Just like alternative crops are grown to obtain vegetable oil, oil palms provide a year-round source of income for plantation workers and small plantation owners. 

It also holds immense potential to bolster the country’s economy on various fronts, by reducing reliance on imported edible oils, and potentially creating a lucrative export industry in the future. In fact, Solidaridad has released the “Myths and Truths of Oil Palm,” a research-based scientific study that provides information and assessments on palm oil through an in-depth literature review of research findings by over 15 leading scientists from top universities and research institutions across Indonesia, Malaysia, India and Sri Lanka.