Aitken Spence Deputy Chairman Parakrama predicts 10-20% shortfall in 2023 tourism earnings target

Friday, 1 December 2023 00:20 - - {{hitsCtrl.values.hits}}

Aitken Spence Deputy Chairman and Managine Director Dr Parakrama Dissanayake

Expresses scepticism about Govt. decision to implement MRR for Colombo City Hotels

Aitken Spence PLC Deputy Chairman and Managing Director Dr. Parakrama Dissanayake on Wednesday predicted Sri Lanka may not achieve the $ 2.7 billion earnings target in 2023.

Speaking at the Ceylon Chamber of Commerce ‘Sri Lanka Economic Summit 2023’, he anticipated a potential shortfall of 10-20% in the earnings target, citing concerns despite the reported tourist arrival numbers by authorities.

“A significant portion of the arrival numbers dished out comprises individuals visiting friends and relatives rather than contributing to the tourism revenue,” he pointed out.

Originally, Sri Lanka Tourism set a $ 3 billion earnings target but it was later revised to $ 2.7 billion after scaling down the arrivals target from 2 million to the original goal of 1.55 million for 2023.

The Central Bank data showed that during the first 10 months of the year, earnings totalled $ 1.59 billion, a 56% year-on-year (YoY) growth compared to the same period in 2022. October earnings stood at $ 136.70 million.

He also expressed scepticism about the Government’s decision to implement a minimum room rate (MRR) for Colombo City Hotels.

Dissanayake’s concerns delve into the implications of Government intervention in pricing mechanisms and argue such involvement rather than allowing market forces to dictate rates.

“Are we sending the right message when the Government gets involved in the pricing mechanism without leaving it to the market forces? Is it helping the overall tourism objectives in Sri Lanka?” he added.

Dissanayake›s remarks also shed light on the policy increasingly perceived as a threat to competitiveness and an unwarranted form of Government intervention.

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