Sri Lanka's tourism industry is booming and recorded half-year earnings of $1.3 billion in June 2015 as more and more people experience the nation’s delights
Sri Lanka wants to boost its tourism numbers, as it targets 2.5 million arrivals in 2016. During the first six months of 2015 the numbers have increased by 14.1% to 830,051 compared to the corresponding period of 2014. The Central Bank of Sri Lanka reports the top five sources of tourist arrivals were India, China, UK, Germany and France accounting for about 49.8% of the arrivals.
“You wouldn’t see a diverse place like this anywhere else in the world. We have a distinct heritage with a diverse culture, historical sights, pristine beaches, wildlife, mountains, agro tourism and plenty more to offer,” says Dr. Rohantha Athukorala, Chairman Sri Lanka Tourism Promotions Bureau. “The future looks bright for the tourism industry, given that we have a very strong below-the-line activation program that includes road shows, attending key travel trade fairs, and staging B2B meetings between the Sri Lankan private sector and overseas travel agents and operators, as well as opening new markets like South Korea, a lifestyle brand ‘Bravo on Italy’ and the launch of Sri Lanka tourism with the top 36 private sector companies in the booming city of a China – Quingdao.”
Sri Lanka’s shell-shocked tourist industry had been devastated by the civil war that ended in 2009. Since then it has had trouble keeping up with its neighbors in order to attract key tourism numbers. However, the current government is defining the tourism sector as the key industry to boost its economy in the wake of the January 2015 Presidential Elections. Minister of Tourism and Sport Navin Disanayake states, “Our government is spending ambitious budgets, targeting new markets and consolidating the existing market.” The Tourism Promotion Bureau has been given a priority to find a global communication partner that can assist in maximizing and finding new, out-of-the-box solutions in order to crystallize Sri Lanka’s branding.
Optimizing the asset base: building the hotel infrastructure
With great profits to be had, owning and operating hotels provides attractive returns in an industry set for explosive growth and relatively stable infrastructure. Investors who acquired land banks during the extensive civil war are now seeking to develop their own asset base. With Sri Lanka’s auxiliary infrastructure tailing behind, hotels are seeking to create more destination leisure experiences – developing their assets with a diverse range of self-contained facilities. Most hotels are investing in dedicated meeting spaces, beach and safari activities, and unique dining and leisure experiences, creating a huge need for capital in any refurbishment or green-field development.
New entrants are flooding the market, while existing players acquire, rebrand and refurbish. The international hotel chains have already begun setting a base here, such as Shangri-La, Sheraton, Mövenpick, India’s upscale ITC Group, Thailand’s Minor Group, Singapore’s Aman Resorts, the Banyan Tree Group Singapore and the Mustafa Group of Singapore.
The island has also seen a rise of small boutique hotels that bring panache to the industry, catching up with global trends. Growth of internet booking services have made it easier for small-scale accommodation providers to sell rooms to a larger market. Booking.com, the popular hotel reservation website, lists over 3,500 properties offering accommodation in Sri Lanka, compared to around 300 graded establishments in the country. Managing Director Daiva Vedikyte of the six-suite Casa Colombo Mirissa Boutique Hotel on the south coast – a sister hotel of the Casa Colombo Collection, winner of the ‘best classic boutique hotel’ category at 2014’s Boutique Hotel Awards – says, “The small size of boutique hotels often means they are able to focus more of their resources on making each guest’s stay memorable through exceptional service.”
The allure of the nation’s heady blend of stunning natural beauty, cultures, religions, people, cuisine and heritage, all creating a wealth of sights, sounds and flavors to savor, is sure to prove increasingly irresistible to investors looking to tap expanding markets that pack panache as well as punch.