Tourism sector leaves the best for the last

Last Monday, in an effort to entice 5,000 soccer fans from around the world to the “FIFA Zone” in Negombo for the four to five days in between World Cup games, Sri Lanka Tourism formally unveiled an innovative travel offering package. 

More than 42,000 tourists visited Sri Lanka in October, bringing the country’s total number of visitors for the year to over 576,000. The country had lofty goals to welcome at least one million visitors by the end of the year from which the Government expected to generate 1.8 billion dollars in revenue from the tourism.

The tourism industry currently contributes 12% of the nation’s GDP. The third-largest source of foreign currency in Sri Lanka, the sector boosts the economy by creating thousands of new direct and indirect jobs as well. In 2022, this was to utilised to our advantage. 

While an increase from the 4,581 tourists who arrived in March 2021 to an estimated 106,500 tourists in March 2022, was seen coming out of the pandemic, arrivals decreased did not sustain. Only 30,207 arrivals were seen in May 2022 as a result of Sri Lanka’s economic instability. 

Moreover, the need to diversify the tourism offering was certainly felt this year owing to the Russia-Ukraine War and resulting dip in tourists from that region. To encourage tourism from non-traditional locations, Sri Lanka has introduced a number of online initiatives. Thousands of visitors from Europe are anticipated in Sri Lanka in November and December as a result of the ongoing conflict, which has caused an energy crisis in Europe, that may even see more tourists escaping the northern hemisphere winter. 

In the meantime, the Government has launched numerous measures to resurrect the tourism sector with creative packages. One such package is the Murugan-Shiva Shakthi route to attract Indian tourists. The success of this project can be seen as India accounted for 16% of all tourist arrivals as of August.

The reintroduction of direct flights between Sri Lanka and Russia has already contributed to the majority of tourist arrivals this month. Following the arrival of approximately 8500 visitors during the first five days of November, the tourism industry is optimistic about a strong winter season. 

However, the cost of running the hotel will be affected by the devaluation of the rupee because energy, water, maintenance, consumables, other overheads and taxes will have gone up, along with inflation. Sri Lankan hotel rates are higher than the typical hotel room rates in November 2022 in Phuket, Pattaya, Langkawi, Bali and Vietnam according to a comparative hotel rate survey.

The decision-makers involved in pricing items should keep in mind that tourists choose Sri Lanka as their vacation destination to experience the authenticity and diversity that this welcoming island nation has to offer, not just the hotel and its amenities, in pricing packages.

The country’s economy will suffer and lose out on much-needed foreign exchange if the pricing policies of hotels are not reasonable and competitive. In this regard, it is typical that it will take several years and extra money to reclaim lost market share. However, this number is unquestionably less than the projected goal of a million arrivals. 

Before current President Ranil Wickremesinghe was elected, Sri Lanka experienced a political crisis that resulted in the weekly cancellation of more than 30 flights. Due to Sri Lanka’s political and economic crisis, certain nations have issued negative travel warnings, and Sri Lanka has been the target of hostile media campaigns, especially on social media. That might have encouraged travellers to use their money elsewhere. 

However, the latest figures show that the nation has corrected the narrative, hopefully enough to reach the optimistic target of 2 billion dollars in revenue and more than two million visitors in 2023. The country may therefore be able to escape its current economic difficulties if there is a sustained increase in visitor arrivals to the predicted post-pandemic levels.