Browsing by Author "Wijetunga, C.S."

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    The Competitiveness of Sri Lankan Tea: A Policy Analysis Matrix (PAM) Approach
    (Uva Wellassa University of Sri Lanka, 2021) Vithunan, T.; Wijetunga, C.S.
    Tea production in Sri Lanka seems to be distorted in recent decades due to government intervention through different taxes and subsidies. In addition, Sri Lankan tea industry is facing enormous challenges such as low productivity, low replanting rate, high cost of production, and shortage of labor. Moreover, Kenyan and Chinese teas are becoming rapidly popular in the world market, while Sri Lankan tea is losing its market share by 1.2% during the pandemic situation. The study aims at undertaking a detailed analysis of policy support for tea production in Sri Lanka for the period of 2006-2019 using Policy Analysis Matrix (PAM) Approach. The study is based on the secondary data obtained from the Sri Lanka Tea Board, Department of Census & Statistics, Trade map Web, Central Bank of Sri Lanka and Ministry of Plantation. The Nominal Protection Coefficient (NPC), Effective Protection Coefficient (EPC), and Domestic Resource Cost (DRC) are estimated using PAM approach. Study results indicate that the values of NPC, EPC, and DRC are less than one for the period of 2006-2019. Hence, study suggests that Sri Lankan tea industry is not protected through the policy interventions while the available resources are efficiently and effectively utilized and there is a vast scope for Sri Lankan tea in terms of export to the countries. Additionally, DRC values indicate that the use of domestic factors are socially profitable in Sri Lanka despite increase cost of production over the years. However, tea production and export in the country will be negatively affected in the coming years due to recent government policy changes, such as the import banning of chemical fertilizer and other agro chemicals, as well as increased Cess tax. Therefore, the Sri Lankan government needs to consider about increasing input subsidies and other agricultural subsidies, which could affect competitiveness in tea industry in the country. Furthermore, lowering export Cess tax and establishing trade agreements with other nations will help to raise tea's export share in the global market. Keywords: Cost of production; Domestic resource cost; Effective protection coefficient; Nominal protection coefficient; Policy Analysis Matrix (PAM); Tea industry
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    Households Demand for Selected Food Commodities in Uva Province of Sri Lanka
    (Uva Wellassa University of Sri Lanka, 2020) Dilanka, W.A.A.; Wijetunga, C.S.
    The pattern of food consumption in Sri Lanka has been undergoing dramatic changes over the last decades. The changes in food prices and income have a greater effect on the food consumption pattern of households, especially among the poorer households. This study investigates the effects of food price and income variation on households’ food consumption patterns in the Uva province using Household Income and Expenditure Survey 2016 conducted by the Department of Census and Statistics. The study estimated the demand for selected food items namely rice (white kekulu – normal), bread, dhal, chicken, coconut, milk powder, and sugar applying the Linear Approximation of the strict Almost Ideal Demand System model using the Seemingly Unrelated Regression procedure. Descriptive analysis show households in Uva province spend mainly on cereals and vegetables while the lowest amount spends on sugar, meat, and pulses compared to other provinces. Especially, liquor consumption is remarkably high in Uva province. The result shows that all food items are normal goods because all items have positive expenditure elasticity. Expenditure elasticity for rice, milk powder, and coconuts are greater than one implies these food items are luxury goods. The own-price elasticities are negative for all food items and less than one in absolute value, indicating price inelastic demand in these goods. Besides, almost all cross-price elasticities show negative values imply that they are complementary goods. This study concludes that households in Uva province are highly sensitive for price changes of some necessary foods including rice. Finally, this analysis suggests formulating targeted food policies to increase local production of luxury food items such as milk and rice to assist the poor families in the Uva province. Keywords: Almost ideal demand system, Elasticity, Food consumption pattern, Household, Uva province
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    Technical Efficiency and Inefficiency Determinants of Chili Cultivation in Vavuniya District of Sri Lanka
    (Uva Wellassa University of Sri Lanka, 2020) Mohanachandran, K.; Wijetunga, C.S.
    Increasing the productivity of green chili is important to meet the market demand as well as to reduce the food import bill. However, farmers face productivity issues due to the lack of knowledge on how to maximize the level of output at a given level of inputs. This study focuses to evaluate the technical efficiency of green chili farmers and subsequently identifying the determinants of technical inefficiency in the Vavuniya district of Northern Province in Sri Lanka. The data used in this study were based on a direct interview survey of 297 randomly selected green chili farm households conducted in 2019. The stochastic frontier analysis was used to evaluate technical efficiency. The estimated stochastic production frontier model indicates that parameters used in production such as fertilizer, chemicals, land, labour, seed variety, and irrigation had significant effects on yield. The coefficients for land, labour, and fertilizer had positive values of 1.07, 1.93, and 1.99 respectively. The results show that the mean technical efficiency of farmers is 93% ranges from 74% to 97%. This implies that there is room to improve the efficiency level of farmers on average by 7% using current technology and available inputs. The variables of age, education level, access to extension, and household size negatively affected technical inefficiency. Therefore, this study proposes providing better farmer training programs and enhance the education level of farmers and providing farmers with the opportunity of accessing better extension services to improve technical efficiency. Keywords: Chili Cultivation, Cobb-Douglas stochastic Production Frontier, Technical Inefficiency, Production Efficiency, Determinants