How Does Coconut & Coconut-based Products Industry Contribute to Sri Lanka’s Economy?

The coconut and coconut-based products industry play a significant role in the economy of Sri Lanka. The country is home to over 3 million coconut palms and is one of the world’s leading producers of coconuts. In this article, we will explore how the coconut and coconut-based products industry contributes to Sri Lanka’s economy.

First and foremost, the industry provides employment opportunities for a large number of people in Sri Lanka. The coconut industry is a major source of income for smallholder farmers, and it also employs a significant number of people in the processing and export of coconut-based products. According to the Coconut Development Authority of Sri Lanka, the industry employs over 2 million people directly and indirectly.

The industry also contributes to the country’s foreign exchange earnings. According to the Department of Commerce, Sri Lanka’s export of coconut-based products was valued at $365 million in 2020. The main products exported are fresh coconuts, desiccated coconut, and coconut oil. Exports of these products not only bring in much-needed foreign exchange but also help to promote the country’s reputation for producing high-quality coconut-based products.

The industry also contributes to the country’s GDP. According to the Central Bank of Sri Lanka, the contribution of the coconut industry to the country’s GDP was around 2% in 2020. While this may not seem like a significant contribution, it is important to note that the industry has significant potential for growth, and as such, its contribution to the country’s GDP is likely to increase in the future.

The industry also helps to improve the livelihoods of smallholder farmers. The majority of coconut farming in Sri Lanka is done by smallholder farmers, and the industry provides them with a stable source of income. The government also provides subsidies and other forms of assistance to help smallholder farmers improve their operations, which helps to improve their livelihoods.

Finally, the coconut industry also helps to improve the country’s balance of trade. Sri Lanka imports large quantities of vegetable oil, but with the increasing production of coconut oil, the country is able to reduce its dependence on imported oil and improve its balance of trade.

In conclusion, the coconut and coconut-based products industry plays a significant role in the economy of Sri Lanka. The industry provides employment opportunities and contributes to the country’s foreign exchange earnings, GDP, smallholder farmers’ livelihoods, and balance of trade. With the increasing focus on the promotion of coconut-based products by the government, the industry has significant potential for growth in the future.

Notes:

• The coconut and coconut-based products industry is a significant source of employment and income for smallholder farmers in Sri Lanka.
• The industry also contributes to the country’s foreign exchange earnings and GDP.
• The government is working to promote the industry and increase its potential for growth, which will in turn contribute more to the economy of Sri Lanka.
• The industry also helps to improve the livelihoods of smallholder farmers and the balance of trade.