Rs. 800 m destination marketing plan next year

• Sunny times for tourism as industry gets much awaited budget to promote Sri Lanka internationally

By Charumini de Silva

After years of fierce lobbying by the private sector for a State-driven international marketing strategy for tourism, the Government will launch its destination marketing program with an investment of Rs. 800 m next year. 

Mount Lavinia Hotel Chairman Sanath Ukwatte was unanimously appointed as President of The Hotels Association of Sri Lanka (THASL) at the Annual General Meeting (AGM). Ukwatte took over as the new President for 2016 - 2017 from Jetwing Chairman Hiran Cooray, who served the association as President for six years. 

Tourism Development Minister John Amaratunga, speaking at the event on Tuesday assured the program could be launched early next year as the promotional program is now at procurement stage. 

“From the day I took office I have been pushing to get this program off the ground, but I have been constrained by bureaucratic road blocks which have been created as a result of the financial indiscipline that prevailed during the previous regime,” the Minister explained.

The breakdown of the four major campaigns includes Rs. 300 m for global advertising, Rs. 200 m global online digital marketing for, global PR Rs. 200 m and Rs. 100 m for content development.

Noting that one of his main goals is to see tourism becoming the number one foreign exchange earner by 2020 he urged hoteliers to come up with innovative concepts and ideas to increase the revenue derived from each tourist.

Speaking of minimum room rates in Colombo city hotels he said: “Although this matter was discussed with the industry at length, following which the Tourism Advisory Committee arrived at a unanimous decision to abolish the minimum rates by end March next year, we will extend it for a further period following consultations with the Finance Ministry.”

Amaratunga pointed out that despite minimum room rates being a highly contentious issue, it would be in the best interest of the industry to allow market forces to determine rates in the not too distant future.

Responding to hoteliers’ laments on financial difficulties faced when refurbishing some of the older properties, he stressed that he has given this matter serious consideration and decided to take up the issue in cabinet. “While I’m not in a position to offer any guarantees, I will attempt to obtain some form of concessions for refurbishing at least the older properties.”

The Minister called on hoteliers to step-in to fill the void by coming up with their own training programs for specialised frontline staff, to raise skill levels and improve standards through professional training, arguing that it could be considered their contribution to the national endeavor to raise service standards.

Newly elected President Ukwatte stressed the importance of marketing and promoting Sri Lanka internationally and the importance of the industry for the socio-economic development of the country.  

Commenting on the importance of immediate implementation of ‘Sri Lanka Tourism Vision 2025’ he emphasised that initiatives in marketing, promotions, profiling destination via branding in an aggressive global campaign to increase demand for the destination are definitely the call of the hour.

“The industry at present contributes nearly 3.5% of the country’s GDP and over the next five years the sector is forecasted to contribute nearly 5% of the total GDP. Last year, the hotel industry alone contributed 64% of the total tourism foreign exchange earnings and nearly Rs. 18 b as taxes, VAT and TDL to the national budget,” he added.

He stressed the point of not having any further increases in Government taxes and levies at this juncture as it is critical that the hotel sector remain competitive in the market and be able to reinvest earnings for further improvement of hotels.

Ukwatte also contended the success of the much debated minimum room rate for Colombo City Hotels, insisting hotel stakeholders have “benefited immensely” during the past years. As a result, Colombo hotels offers quality international star class accommodation at different price points catering to different profiles of clients, he claimed.