Line a 9 x 5 inch loaf pan with foil; set aside. In a small cup, mix 2 drops each of red, blue, and green food coloring. Pour the coconut in a zip-close plastic bag and add the food coloring mixture. Seal the bag and shake to color coconut. Use clean safety scissors to cut licorice into 48 one-inch pieces. Set all of this aside.
In a medium-sized microwave-safe bowl, mix chocolate chips, sweetened condensed milk and salt. Microwave on high for 3 minutes, stirring well after each minute, until chocolate is completely melted. Stir mixture until smooth.
Spread evenly into prepared pan. Chill in fridge until firm (1 hour).
Lift fudge out of the pan by the foil and place on cutting board. Parent should cut fudge into 12 equal squares, using large, heavy knife. Roll each square into a ball between your palms, then roll balls into colored coconut. Stick two balls together to for the tarantula's body and set on a cookie sheet lined with waxed paper. Stick 8 pieces of licorice inot each body for legs.