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EASTERN SRI LANKA, 2008-08-26
A groundbreaking pilot project is underway to help poor farmers in Sri Lanka's East switch to modern commercial agriculture and raise their productivity.
In April 2008, Sri Lanka's Hayleys Group and the United States (US Government) Agency for International Development (USAID) launched a pilot project to link farmers in Ampara and Moneragala Districts to commercial agriculture.
This project, which got underway in April 2008, has already benefited 160 farmer families in Ampara and Moneragala through the introduction of the latest agricultural practices and high-quality inputs for the cultivation of cash crops with high revenue potential. Farmers are now growing gherkins, pineapples and jalapeno peppers on 60 acres of land that have either lain fallow or used previously for subsistence farming.
The objective of the project is to motivate farmers in these areas, some of whom have been affected by Sri Lanka's 25-year conflict, to embrace modern agricultural practices and to empower them to substantially improve their incomes from agriculture by switching to cash crops that are high in demand. The farmers selected to participate in the pilot project represent the three ethnic communities predominant in the two districts: Sinhalese, Tamils, and Muslims.
USAID/Sri Lanka selected the Hayleys Group as a partner for the project on the basis of the company's expertise in the cultivation, harvesting, packaging and marketing of such crops; its existing successful out grower programs; and the company's long-standing involvement in agriculture. At the launch of the partnership, USAID's Mission Director Rebecca Cohn said that USAID' partnership with Hayleys would establish a value chain that will bring sustainable economic growth to those in need in the Eastern and Uva Provinces. This is one way in which people can move up the path from poverty to prosperity.
Hayleys' market access offers tremendous opportunities for Sri Lanka's farmers to make the transition from subsistence to commercial farming. The Hayleys agribusiness subsidiaries, HJS Condiments Ltd and Sunfrost Limited, account for 34 percent of Sri Lanka's exports of fruits and vegetables. The Hayleys Group is the sole exporter of gherkins from Sri Lanka and the second largest in Asia, processing more than 8,000 tons a year. It accounts for 50 per cent of the market for bottled pickles in Japan and is a major supplier to well-known international brands such as McDonalds, Burger King, Unilever and Heinz.
A New Business Model for Development
Today, 85 percent of resource flows from the United States to the developing world are private. The high percentage of private flows reflects a significant change and the emergence of for-profit companies and the non-governmental sector as significant participants in development. By adapting its business model, USAID is able to extend its reach and effectiveness in meeting development objectives by combining our strengths with the resources and expertise of private actors such as Hayleys/Sunfrost.
Under this pilot project, Hayleys and Sunfrost are providing extensive inputs ranging from farmer training on improved agricultural practices and business management, to seeds, fertilizers and pesticides. Sunfrost and Hayleys are also sharing their expertise in modern cultivation, harvesting, packaging and transportation methods, and by purchasing the whole crop of project beneficiaries, they are linking out-growers to national and export markets. The inputs are provided on credit to the farmers participating in the pilot, and USAID has donated soil testing kits, digital microscopes for disease identification, and crates to reduce post-harvest losses.
At the launch of the project in April 2008, Rizvi Zaheed, Hayleys Group Director and Head of the Agriculture & Agri-Business cluster, said this project is one of the most exciting projects in the agriculture sector because it is introducing modern agricultural practices, such as soil testing, scientific plot selection, and post-harvest processing to minimize losses, to a long-neglected area of Sri Lanka and creating new business opportunities that will raise farmers' incomes. Mr. Zaheed also said he hopes the project will lead to an agricultural renaissance in the Eastern and Uva provinces through a conversion to modern practices.
Rated a Business-to-Business (B2B) Superbrand among Sri Lanka's diversified conglomerates, the Blue chip Hayleys Group is strongly focused on domestic value addition in industry, agriculture and transportation. Today, the Group employs more than 35,000 people and accounts for 2.7 per cent of Sri Lanka's export income and 2.2 per cent of the country's GDP. Hayleys celebrates its 130th year in Sri Lanka this year.
The partnership between the Government of Sri Lanka and the United States Agency for International Development (USAID) dates back to 1956. Since then, USAID has provided more than $1.9 billion in foreign assistance for economic development programs, infrastructure, stabilization, and disaster relief assistance to Sri Lanka.
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