Sri Lanka’s tourism sector is once again being presented as a pillar of economic recovery, supported by rising levy revenues, improving earnings, and ambitious plans for a unified national brand. Yet behind the optimistic figures and policy rhetoric lies a critical question: can the government realistically steer tourism growth through branding and community-centred narratives without addressing deeper structural weaknesses?
According to data presented to Parliament by Foreign Affairs, Foreign Employment and Tourism Minister Vijitha Herath, revenue from the Tourism Development Levy (TDL) reached Rs. 2.58 billion in 2024 and has already climbed to nearly Rs. 2.93 billion during the first nine months of 2025. These figures point to a sector recovering steadily from years of crisis, helped by improved arrivals and stronger foreign exchange inflows.
Tourism earnings reinforce this trend. Total revenue stood at around USD 3 billion in 2024, while earnings from January to October 2025 amounted to USD 2.66 billion. Average daily tourist spending was USD 181.15 in 2024, with wide variations depending on source markets, ranging from mid-USD 150 levels to over USD 200 for visitors from countries such as the UK, Germany, China, Russia, and India.
The government now wants to move beyond numbers and reposition Sri Lanka under a single, unified national brand. Minister Herath acknowledged that Sri Lanka is already known globally as a tourist destination, but branding has evolved in a fragmented and uncoordinated manner. Under the Sri Lanka Tourism Promotion Bureau, work has begun on a “nation branding” framework intended to be used across institutions linked to tourism.
However, critics argue that branding alone cannot resolve fundamental challenges. Room rates remain relatively low despite growing demand, partly due to a sharp expansion in capacity, with an estimated 90,000 rooms added over recent years. Even after shocks such as the Easter Sunday attacks, room rates were reportedly around 20 percent lower than comparable star-class hotels in competing destinations, raising concerns about value erosion rather than value creation.
The government has also pushed back against criticism of “low-cost tourists,” emphasising community-centred growth. Budget travellers, the Minister argued, spend directly in local economies through homestays, small restaurants, transport providers, and informal vendors, spreading benefits beyond large hotel chains. He also noted that today’s low-budget visitor could become tomorrow’s high-spending family tourist.
Yet this narrative raises questions about sustainability. While inclusive growth is desirable, Sri Lanka still lacks a clear strategy to upgrade tourism products, improve skills, and increase per-visitor value without pricing itself out of the market. High-end tourists, who often seek authentic experiences rather than luxury alone, do not automatically compensate for low accommodation yields.
Institutionally, the government has attempted to tighten coordination through a Presidential Task Force on tourism development, established in August 2025, which has already met three times. Combined portfolios and faster decision-making are presented as strengths, but the effectiveness of this approach will depend on implementation rather than intent.
As Sri Lanka pursues a unified brand and community-focused tourism model, the gap between policy ambition and on-the-ground realities remains wide. Without realistic pricing strategies, product diversification, and governance reforms, the promise of sustainable tourism growth may prove harder to deliver than official projections suggest.
