Tourism industry welcomes Central Bank policy decision to accept foreign currency

Friday, 21 January 2022 00:05 - - {{hitsCtrl.values.hits}}

THASL President M. Shanthikumar says permission to accept foreign currency will benefit tourism industry
SLAITO President Thilak Weerasinghe welcomes move, says it has been the practice as well
Calls for more clarity on payment mechanism
Insists every stakeholder is important

By Charumini de Silva

The tourism industry yesterday welcomed the Central Bank’s decision to allow registered tourist establishments to accept foreign currency for services.

In its first Monetary Policy Review for 2022, the Monetary Board of the Central Bank has decided to mandate all registered tourist establishments to accept foreign exchange only in respect of services rendered to person’s resident outside Sri Lanka.

“We welcome the move by the Central Bank. The move is helpful for our members in these trying times and especially for members that had obtained loans in foreign currencies,” THASL President M. Shanthikumar told the Daily FT.

He also described the move as another step towards recognising tourism as an ‘export industry’.

Most of the tourist hotels registered with Sri Lanka Tourism Development Authority (SLTDA) already hold licences to accept foreign currencies.

“I think it is a good move and it has been practiced for some time as well,” Sri Lanka Association of Inbound Tour Operators (SLAITO) President Thilak Weerasinghe told the Daily FT.

However, he pointed out that the mechanism should not belittle the trading currency of the country and force the industry to pay.

“Not every establishment has foreign currency accounts or foreign exchange. If it is allowed to accept the rupee equivalent to the foreign rate as we practice now, there will be no problem,” he added.

Weerasinghe said the industry collectively needs more clarity on the decision particularly with the mechanism, noting that every establishment is important.

“The industry faced many challenges and it is a collective effort to revive it. Hence, no stakeholder should be left behind,” he stressed.

Some of the other stakeholders pointed out that foreign currency attracted by the industry should be allowed to get into the mainstream, without being converted by the banks immediately.

“The foreign exchange attracted by the industry is absorbed by the banks immediately and the payments are made to hotels and other services in local currencies,” they added.