Tourism Development Authority sheds light on MRR 

• Chairman Priantha Fernando says intervention was after industry associations could not resolve matter internally over past 3-months
• Rejects claims decision maker was misled; noting Minister publicly justified decision on Monday
• Stresses need to align with President Wickremesinghe’s objective of establishing Sri Lanka as a high-end tourism destination
• Assures SLTDA remains open to revisiting decision if necessary

Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando

By Charumini de Silva

Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando shed light on the recent discussions surrounding the minimum room rate (MRR) whilst, calling on stakeholders to engage in constructive dialogue, foster unity, and work collaboratively towards the common goal of developing a thriving and sustainable tourism landscape.

“The topic was initially raised three months ago when hoteliers approached the regulator expressing their desire to re-impose the MRR. However, after unsuccessful attempts to resolve the matter internally, the industry sought the involvement of the regulatory authority after two and a half months,” he told the Daily FT.

He clarified that SLTDA initially refrained from intervening, encouraging the hoteliers to reach a consensus among industry stakeholders. Yet, after two and a half months, it became apparent that internal resolution was proving challenging. 

“Consequently, both the Tourist Hotels Association of Sri Lanka (THASL) and the Colombo City Hoteliers Association (CCHA) submitted written appeals to the SLTDA and the Presidential Secretariat. Upon their submission the SLTDA approved the proposal,” he added.

Addressing claims that the Tourism Minister was misled, the SLTDA Chairman rejected such assertions, highlighting that the Minister publicly justified the decision on Monday.

“If SLTDA did not intervene to protect small and medium-sized enterprises (SMEs), the accusations of allowing monopolies would arise. Hence, SLTDA encouraged the industry associations to resolve the matter internally three months ago, foreseeing the potential consequences,” the Chairman said.

Fernando underscored the importance of market conditions and industry standards, emphasising the need for all stakeholders to reach a mutual understanding and agreement. 

He stressed the significance of the private sector in developing new products and strategically positioning them, aligning with President Ranil Wickremesinghe’s vision to establish Sri Lanka as a high-end tourism destination.

Expressing concern about the oversupply of hotels in Colombo, Fernando highlighted the importance of strategic positioning and the introduction of new products, similar to hotels outside Colombo where prices range from $500 to $1,500 per night, leading to high occupancy rates in popular destinations such as Yala.

In response to opposition to the decision, Fernando noted that neither the Sri Lanka Association of Inbound Tour Operators (SLAITO) nor any opposing hotels or hotel chains had formally submitted objections so far. 

Fernando assured that the SLTDA remains open to revisiting the decision if necessary.

Lamenting the lack of unity within the industry, the SLTDA Chairman insisted on the need for improvements in products and services to unlock the true potential of the Meetings, Incentives, Conferences, and Exhibitions (MICE) market for profitability. 

He outlined the importance of addressing market demands and enhancing the overall visitor experience to ensure sustained growth and success in the tourism sector.