A study of the economic crisis associated with international trade and the living standards of the people in Sri Lanka: with special reference to state sector people.

Abstract

Introduction: Sri Lanka has experienced a series of interconnected economic crises in recent years, closely linked to international trade disruptions, which have significantly affected living standards within export-oriented sectors. This study examines the socioeconomic impacts of the Easter Sunday attacks (2019), the COVID-19 pandemic (2020–2021), and the post-COVID economic crisis on individuals engaged in the tea industry, with special reference to the Harangala Tea Factory in the Nuwara Eliya District. The main objective is to identify and compare the positive and negative effects of these crises on the living conditions of different stakeholder groups within the tea sector.

A mixed-methods approach was employed, utilizing both primary and secondary data. Primary data were collected through structured questionnaires and semi-structured interviews with management employees, estate owners, and factory workers, while secondary data were obtained from official national statistics and factory records. Descriptive statistical techniques and thematic qualitative analysis were used to assess changes in income, employment stability, and overall living standards during the crisis periods.

The findings reveal uneven impacts across stakeholder groups. Management-level employees and many estate owners experienced income gains, largely due to currency depreciation and higher commodity prices. In contrast, factory workers faced severe income losses resulting from factory closures, reduced working hours, and transport disruptions, leading to increased indebtedness and livelihood insecurity. Despite these hardships, some adaptive responses, such as home gardening, emerged among workers.

The study concludes that international trade-related economic crises intensify existing structural inequalities within Sri Lanka’s tea industry. It emphasizes the need for inclusive and context-specific policy interventions, including social protection mechanisms, livelihood diversification, and rural development strategies, to enhance resilience and protect vulnerable groups during future economic shocks.