Tourism boom positively impacts other sectors

The impact of the tourism boom enjoyed by the country after the end of the conflict had spread to the other sectors, resulting in a big increase in production and services.

The internal conflict that prevailed in the country for 30 years ended in May 2009 and tourist arrivals increased in an unprecedented manner since then. As compared to the 438,475 tourist arrivals in 2008, an increase of 95.2% was recorded in 2011, increasing the total arrivals to 855,975.

Official receipts from tourism increased from Rs. 37,094 m in 2008 to Rs. 91,926 m in 2011, recording 147.91 per cent increase. In foreign exchange terms that amounted to US$ 319.5 m in 2008 and US$ 838.9 m in 2011, an increase of 162.56 per cent. In 2008 receipt per tourist per day was US$ 76.7 and it increased to US$ 98 in 2012. Hotel occupancy rate of the country increased to 77.1 2011 from 57.1 in 2008.

Minister of Economic Development Basil Rajapaksa introduced the Tourism Development Strategy of Sri Lanka in order to facilitate the big boom in the industry and cater to the growing demand for various services. The Ministry of Economic Development provided various incentives for short-term and long-term investment in production and services related to the industry.

This boom in the tourist sector has resulted in a big increase in production and services of other economic sectors. Total number of foreign visitors to the museums increased to 31,096 in 2011 from 7,353 in 2008 and revenue from sale of tickets increased from Rs. 4.1 m in 2008 to Rs. 14.2 m in 2011.

The biggest gainer was the Cultural Triangle. The number of foreign visitors to the Cultural Triangle increased from 112,190 in 2008 to 239,920 in 2011, increasing the revenue from Rs. 307.5 m in 2008 to Rs. 998.3 m in 2011 recording an increase of more than threefold. Foreign visitors to the Zoological Gardens increased to 284,898 in 2011 from 153,934 in 2008, bringing Rs. 470.2 m income in 2011 as compared to the Rs. 114 m income it received in 2008.

Income of the wildlife parks increased to Rs. 301 m in 2011 from Rs. 84 m in 2008. Botanical gardens’ revenue from foreign visitors increased to Rs. 253 m in 2011 from Rs. 69 m in 2008.

Government revenue also increased as a result of increased tourist arrivals. Tourism development levy increased from Rs. 405.2 m in 2009 to Rs. 649 m in 2011 while Tourism Development Authority income increased to Rs. 110.1 m from Rs. 48.9 m in 2008.

 Embarkation tax of the Katunayake Airport increased to Rs. 104 m in 2011 from Rs. 766 m in 2011. In 2008, 5,469 visitors came by charter carriers and it increased to 15,123 passengers in 2011, allowing more services other than regular services.

Other than these sectors, big growth was recorded in the handicraft, handloom and cottage industries and demand for local vegetable, fruits and fish products from the hotel sector has increased tremendously. Local cultural and aesthetic activities aimed at tourists have also increased.