Sri Lanka Tourism poised for steady growth

Strong promotional campaign this year:

By Lalin Fernandopulle

The tourism industry which got off to a flying start with the setting up of the Ceylon Tourist Board in 1966 recording over 19,000 visitors in the first year and then facing the debacle of a thirty-year conflict, is poised for steady growth with arrivals expected to cross the three million mark and a revenue of US$ 10 billion in 2020.

Sri Lanka Tourism Development Authority, Chairman Paddy Withana said Sri Lanka Tourism celebrates the golden jubilee this year which can be considered a milestone for the tourism industry.

The focus on developing Sri Lanka’s tourism sector commenced with the setting up of the Ceylon Tourist Board in 1966 and, thereafter, it earned high revenue and generated around 300,000 direct and indirect employment opportunities. Tourist arrivals which were around 19,079 in 1966 increased to 1,798,380 in 2015.

Economic policy

The importance of promoting and developing Sri Lanka’s tourism industry has been emphasised by the economic policy of the government presented to Parliament by Prime Minister Ranil Wickremesinghe in the 2016 Budget. Sri Lanka has a growing tourism industry. Sri Lanka has continued to attract foreign investors and tourists to the island. The country’s important placement also helps to attract transit visitors to the island.

Over the years, many beautiful resorts, hotels and spas were opened. Incorporating the diverse culture of the country, the various tourist establishments here offer visitors a unique, yet memorable experience.

New challenges

From around 19,079, tourist arrivals in 1966, the industry progressed dramatically over five decades to record 1.8 million visitors at the end of last year.

The income from the industry increased from US$ 1.3 million in 1966 to US$ 2.9 billion by the end of 2015. The number of arrivals grew 17.8 percent year-on-year in 2014 and the number of arrivals will continue to increase, Withana said.

“Over the next several years Sri Lanka Tourism will focus on a sustainable tourism development by improving the stability between the tourism related commercial development with a natural and socio-cultural uplift.

“With this positive vision towards the future of tourism industry, Sri Lanka Tourism is heading towards new challenges with the accomplishment of continued progress, regardless of the rising competition in the global tourism sector,” he said.

Sri Lanka is well on its way to its 2.2 million arrivals goal this year with an estimated growth rate of 22 percent. As at March 31, this year, 584,818 arrivals were recorded maintaining a healthy growth rate compared to 2015. Sri Lanka Tourism hopes to achieve a revenue of US$ 3.6 billion this year and to reach US$ 10 billion in 2020, increasing the per day expenditure of tourist and the number of days spent in the country.

The Government hopes to do this by diversifying tourism offering further through efficient connectivity across the island, enhance products and elevating service standards, Withana said.

It hopes to introduce zonal development for tourism with emphasis on the preservation of cultural, religious and natural resources. Sri Lanka Tourism has set five main objectives to achieve the national goals of sustainable tourism for this year.

Brand value

The government aims to attract 2.2 million visitors this year by taking sustainable steps to incorporate private sector, encouraging local and global tour operators, create a productive and result oriented tourism industry by increasing the daily spend of a tourist up to US$ 170 by the end of this year, encourage the tourists to stay longer in the island, an average of 10 days presenting focused travel packages by marketing Sri Lanka as an attractive tourist hot spot by the end of this year, uplift ‘Sri Lanka’ brand value up to US$ 80 billion by the end of the year through a strategic marketing campaign highlighting cultural, historic, religious and eco-tourism perspectives and increase the tourism revenue up to US$ 3.6 billion by the end of the year by developing sustainable relationships with key trades and businesses of Sri Lanka and scheduling strategic alliances with key markets to innovate and promote product mixes.

The Sri Lanka Tourism Promotion Bureau hopes to achieve these objectives following a strong promotional strategy this year. Twenty roadshows and 32 trade fairs are being held in key markets.

“We hope to launch a global advertising campaign via selected global media especially with top rated global television networks this year. The Visiting Journalist Program (VJP) of Sri Lanka Tourism is aimed at creating awareness on Sri Lanka by bringing down high profile journalists from key markets globally,” Withana said.

Familiarisation tours

The program is carried out in collaboration with key industry associations of Sri Lanka. About 200 media professionals will be hosted on Media Familiarisation Tours from 22 key markets this year. Around 300 trade participants will be hosted on Familiarisation Tours from all 22 key markets to increase the brand recognition among the trade.

The national celebrations of the 50th anniversary of Sri Lanka Tourism will be held on Friday, May 27 at the BMICH with all four institutions associated with Sri Lanka Tourism. A commemorative volume, a commemorative stamp and a video film on the 50-year history will be launched at the national ceremony.

It will be followed by a national exhibition which will showcase important landmarks of Sri Lanka Tourism since 1966. The exhibition will be held from May 27-29 from 10 a.m. to 9.00 p.m.

Sri Lanka Tourism has designed four competitions for those who are passionate about photography, videography, art and essays parallel to the golden jubilee celebrations.

Past Managing Director of Aitken Spence Hotels, Malin Hapugoda said the Government in the mid 1960s recognised tourism as an industry with potential to create employment and earn foreign exchange. Various incentives were granted to the private sector to invest in the industry.

From the mid 1970s tourism arrivals grew on a year-on-year basis by around 20-25 percent. Tourism continued to grow creating employment and earning the much needed foreign exchange to the country until the disturbances in July 1983.

Since then, the industry went into survival mode and the growth momentum was stagnant. Despite the arrival numbers remaining almost static, without much growth the yields dropped and the country became a cheap tropical destination.

Five-star hotels dropped to the level of three-star forcing them to compete with guest houses which were adversely affected as a result. Even the five-star hotels in Colombo dropped their rates to low levels competing in an unhealthy environment. This forced the Government to impose minimum rates in Colombo .

“If Sri Lanka Tourism is to take advantage of the peace and stability in the country it should convey this message effectively in potential markets with the unique advantages the country has to offer to change its cheap image.We should attract the more affluent clients who would appreciate the natural beauty and the other unique attractions,” Hapugoda said.

He said the need for comprehensive advertising fell on the deaf ears of the authorities who felt tourism will thrive with the end of the war and that there was no need to advertise. “Although there were funds available from the tourism levy we failed to make use of it for promotional activities.”

“Today we have a year-on-year increase of around 20 percent in tourist arrivals but we are not attracting adequate numbers from higher segments of the market. We cannot grow only in numbers. If we do so we will be killing the golden goose. We need to formulate a strategy to maximise the yield through proper strategies without focusing only on arrival numbers,” he said.

MICE tourism

Former CEO Sri Lanka Convention Bureau Vipula Wanigasekera said the potential for development of MICE (Meetings, Incentives, Conference and Exhibition) tourism in Sri Lanka is immense, provided we do exactly what MICE industry requires. Incentive Travel will continue to grow and we could reach greater heights if two-pronged promotions viz trade and consumer are undertaken. The consumer promotions will pull the products while specific promotions could be conducted to reach our primary markets.

Sri Lanka can offer diverse locations and creative programs with the available expertise in the industry. He said Sri Lanka has done quite well in the MICE sector bringing the numbers from 28,000 in 2008 to 168,000 in 2015. Revenue from the MICE industry was around US$ 600 million last year and around US$ 98 million in 2008.

However, the conference and exhibition sector needs more infrastructure, entertainment, shopping and night life to compete with the giants such as Singapore, Malaysia and Hong Kong. We still do not have a multipurpose convention centre with convertible facilities and other accessories specially for exhibitions.