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Sat, 26 July 2014 14:05:41
Sri Lanka crate law stirs protest
14 Dec, 2011 10:47:12
Dec 14, 2011 (LBO) - Sri Lanka's fresh produce trade including farmers and collectors rioted in several parts of the country amid police tear-gas after authorities started arresting citizens for transporting vegetables without plastic crates.
The protests also underline deep flaws in the country's policy and lawmaking, critics say.

On Wednesday vegetable shops in the capital were mostly empty as protest by traders continued in the capital Colombo.

At one shop where there was a large pile of beans in a Colombo suburb the shopkeeper said a regular supplier had 'smuggled' in a load of beans and begged him to buy the entire quantity as the supplier feared the police if he tried to distribute to all the shops.

One old timer said the events reminded him of the 1970s when they used to smuggle rice inside vegetable sacks, because the state prohibited the transport of rice under a highly interventionist socialist administration.

"We used to bring rice into the Pettah vegetable market," he said nostalgically. "A sack is first filled with a layer of vegetables, then a bag of rice is placed in the middle.

"Then it is covered with more vegetables. So when the truck is stopped and even if the sacks are poked checked, only vegetables are found."

Sri Lanka's internal trade minister Johnston Fernando insists that the 'law' will be implemented amid protest from at least one lawmaker from Sri Lanka's ruling coalition representing a farming district.

Burnt Crates

Farmers burnt crates and protestors were tear-gassed by police Tuesday in Dambulla, a key fresh produce trade hub in the island's central region. There were also protests in Colombo the capital, Bandarawela in the hill country and Ranna in the South, media reports said.

Sri Lanka's state agencies, including the consumer affairs ministry can make 'law' by gazette without consultation, a dangerous device favoured by many authoritarian rulers especially in Eastern Europe in the past.

The crate law comes shortly after citizens and foreigners' property rights were violated by an expropriation law which critics said was deeply flawed.

Sri Lanka is going back to expropriation when countries like China and Vietnam are bringing sweeping new laws to restore property rights taken from citizens under misguided Marxist principles.

Minister Johnston however has suggested that crates be 'rented' to farmers after being bought from plastic vendors with tax payer money.

It is not yet known what crate contract will cost the tax payer or whether the crates will be bought from one or multiple suppliers and how the 'rents' will be collected and the costs of the collection mechanism itself.

Multi-Faceted

Lawmaker Harsha de Silva, an economist, representing the island's main opposition who has been closely involved with the Dambulla market to improve information asymmetries for several years says problem is complex.

"I have been studying the agriculture supply chain since about 2003, particularly looking at the smallholders," de Silva said. "The problems are multi-faceted."

On one side there was an information asymmetry about what produce is needed at what time and giving better information for farmers to time their harvests.

Another was that there was a 'quality penalty' suffered by farmers due to the lack of standards, and a lack of incentive to produce higher quality goods.

De Silva says in theory the use of crates is a good idea as it will reduce post harvest losses and there is broad agreement among wholesalers about need to move away from sacks, but small farmers in particular face practical problems, which need to be solved.

"While wholesalers can possibly afford crates the bigger problem is at the 'first mile'," de Silva says.

"That is why the farmers and small collectors are rioting."

Collapsible Crate

Small farmers put produce in gunny bags and transport them through various means including bicycles, sometimes buses and then onto trucks. Small farmers and collectors then tie the bags up and take them back.

"They have suggested a collapsible crate," de Silva said.

Collapsible crates would also allow trucks returning from cities to return with a payload, reducing the total transport cost. Before reefer trucks became commonplace lorries transporting fish used to carry empty wooden crates on their roofs on the return journey.

In a free country, policies and laws have to be devised following consultation with citizens.

Especially in economic matters which are not life and death issues and involving business, solutions should be developed and also implemented by the industry with expert guidance from state agencies where needed.

De Silva says there are some vegetables that do not need plastic crates, for example like pumpkins.

If the crate law is strictly implemented he says farmers may move to grow products that do not require crates and that will disrupt supply causing excess production and price collapses which will backfire ultimately on farmers.

If that happens consumers may also have to face high prices for other products.

People in the supply chain say more the produce taken in one truck in gunny bags need more than one truck when vegetables are placed in crates.

"I heard the traders saying they cannot load the lorries since plastic crates consume more space since they are used to overloading the lorries," Sri Lanka's Daily Mirror newspaper quoted minister Johnson as saying, perhaps indicating that he had got to know of the problem recently.

If the existing fleet cannot transport the same amount of vegetables, the fleet has to be expanded, which cannot be done overnight. The main markets will also need to accommodate more trucks.

Meanwhile some vegetables like snake gourd, which are long are do not fit in the crates, the industry complains.

Ad hoc lawmaking

The 'law' was introduced some time ago and the trade was given time to comply, but the reaction from the people and authorities suggests there was not enough consultation or consideration given to the actual market forces at work, analysts say.

There is no information to suggest that a committee of trader organizations or farmer organizers and state or expert representation were tasked with improving the supply chain and agreement sought from the industry on an action plan with timelines.

Analysts say a task force which should implement such a change should be formed with industry representation themselves so that they can have 'ownership' of the change as is usual in a democratic nation.

Advice could also be sought from large retail chains which are using crates for transport and their experience shared with trade associations.

Minister Johnston had apparently agreed to some relaxation to goods transported by farmers in three wheeled vehicles.

Recently the authorities also tried to create a third state-managed pension fund out of deductions from private workers salaries, a move which was abandoned after one protesting worker was killed.

This was despite the existence of a standing national labour advisory council which was kept completely in the dark until the last minute.

The tourist industry was also rocked with high visa fees announced without consultation, but which have now been amended following protests.

It is not known why the state behaves in this fashion towards citizens.

"Sri Lanka's citizens need to be treated more humanely by authorities," de Silva said.

Lands minister Janaka Bandara Tennakoon has also protested against the arrest of lorry drivers by police saying they should not be treated like criminals.

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READER COMMENT(S)
7. Chan Dec 14
I saw a lot of debates going on about the ineffectiveness of the whole vegetable crates thing in a negative way.

Authorities also seems clueless and I also can't think of any straight forward solution to this. I practically know this since my wife's mom is also a farmer, though waste is a problem crates also a problem for them.

So why don't we pull a case where we all share some collective thoughts. Actually government should have done this before hand.

Opposing for any change in the system is a Sri Lankan way. but other than fighting here for nothing, isn't it better we think of better alternatives and open a forum. Thinking of a better  or some effective way to transfer veg stuff has to be done with caution.

I think government has to stop acting funny on this.

Things I can think of

1. First, Study how other countries have done this, follow 2. Make craters in few different standard sizes, cheaper, subsidized.
3. Make them collapsable so won't take much space when empty to transport back
4. Look for durable lightweight alternative crates
5. Implement a gas cylinder like collection way, so crates are not belong to an individual.
6. Implement a system/ group who handle the logistics just like a courier services

6. Dayarathne Kulwanse Dec 14
Dr De Silva, Sir please see my comment below. I know some Sri Lankan university devised an alternative skill development based program to reduce the post harvest loss. Its the same gunny bag but different way of using it. Changing the way people treating vegetables. Not sleeping on them whole on transit etc..

Not sure how to find that report

5. Harsha de Silva Dec 14
This morning in Parliament we requested that the Consultative Committee of the Ministry of Internal Trade and Cooperatives (Hon Johston Fernando's Ministry) be summoned and the matter discussed in Parliament with all stakeholders; including farmer organizations, logistics providers and traders.

The Minister agreed to do so 'if there is time' after the meeting already summoned by the President at 5pm today (14th). I hope the broader consultation will happen tomorrow or the day after. If the meeting happens I plan to propose alternative solutions.

Also I invite others who can contribute at this urgent meeting to please do get in touch with us on this forum or by any other means.

4. De- mystifying the state Dec 14
The state and parliamentary lawmaking and gazetting as we know it now was invented in Europe. In Sri Lanka before Europeans came law was established by custom which could not be changed easily. Reflect on this.

"The state is, if properly administered, the foundation of society, of human coöperation and civilization. It is the most beneficial and most useful instrument in the endeavors of man to promote human happiness and welfare. But it is a tool and a means only, not the ultimate goal.

It is not God. It is simply compulsion and coercion; it is the police power. The state is a human institution, not a superhuman being.

He who says “state” means coercion and compulsion. He who says: There should be a law concerning this matter, means: The armed men of the government should force people to do what they do not want to do, or not to do what they like.

He who says: This law should be better enforced, means: The police should force people to obey this law.

He who says: The state is God, deifies arms and prisons. The worship of the state is the worship of force. There is no more dangerous menace to civilization than a government of incompetent, corrupt, or vile men. The worst evils which mankind ever had to endure were inflicted by bad governments. The state can be and has often been in the course of history the main source of mischief and disaster.

The apparatus of compulsion and coercion is always operated by mortal men. It has happened time and again that rulers have excelled their contemporaries and fellow citizens both in competence and in fairness. But there is ample historical evidence to the contrary too.

The thesis of etatism that the members of the government and its assistants are more intelligent than the people, and that they know better what is good for the individual than he himself knows, is pure nonsense." - Ludwig von Mises

3. Dayarathne Kulwanse BSc Agrono Dec 14
As Dr de Silva said, this crate system is great for single stage supply chains; from large farms to large markets. Classic example is CIV Agri. They use crates so do the leading retail chains.

But 70% + of fresh produce volume go through a scattered "first mile" to even more scattered "last mile" In such a supply chain, the logistics or reusing crates is a a nightmare ad could defeat all the savings that could be accrued by reducing post harvest loss.

Faculty of Agri @ University of Pera or Ruhuna did some work on reducing the post harvest loss by inculcate new sets of work ethics and practices. How to fill gunny bags, how to stack them, what is the optimum stacking heights and stacking order. They brought in scientific experimentation based set of rules. However, that wouldn't have made new money to plastic manufacturers.

Little known secret is that a powerful plastic company is behind this crate law.

2. Tania P. Dec 14
I agree with Mr. De Silva's comments. I feel he is much better aware of the issue than the relevant minister (unfortunately).
1. anuradha Dec 14
Good point on the shortcoming in the law-making process. One which much of the print media has missed thus far. Democracy should not be limited to consulting people by way of a vote at periodic elections. We should ideally have the opportunity to participate in the law-making process by way of public consultations and making laws and policy available to the public in the early concept and drafting stages prior to being passed.

I am all for safer transport of goods that avoids waste. But clearly throwing around tough new regulations like a bull in a china shop is not going to work with complex economic activities that involve so many stakeholders.

A+ on the concept but F on implementation.

Also, I don't mean to be a troll, but this rings more like an opinion piece or a column piece rather than a news article.