By: Staff Writer
December 01, Colombo (LNW): By 2024, Sri Lanka’s hotel industry is set to generate US$180.40 million in revenue, with expectations to grow at a compound annual growth rate (CAGR) of 11.17%, reaching US$306.30 million by 2029.
The country is forecasted to welcome 2 million tourists in 2024, bringing the sector close to pre-pandemic levels. This surge is expected to contribute approximately $3.5 billion to foreign exchange reserves, supporting the nation’s economic recovery.
The Sri Lankan government is prioritizing tourism development, implementing strategic initiatives to boost the sector.
Hotels across the country are increasingly adopting sustainable practices, offering nature-focused experiences, and integrating innovative technologies. These include AI-driven customer service, contactless check-ins, and personalized guest experiences powered by IoT devices.
M. Shanthikumar, President of the Hotels Association of Sri Lanka (THASL), addressed policymakers at the association’s 59th anniversary celebrations, providing a candid assessment of the sector’s challenges and the need for immediate policy intervention.
He emphasized the crucial role of the hotel industry, which contributes significantly to Sri Lanka’s economy, noting US$15 billion in infrastructure investments and the employment of 70% of the tourism workforce.
Shanthikumar pointed out that the sector is the second-largest foreign exchange earner for the country, surpassing apparel, and urged for new, robust policies.
He highlighted the industry’s ongoing struggles, including the impact of the 2019 Easter attacks, the COVID-19 pandemic, and the economic crisis. Despite these setbacks, the sector has shown resilience and is poised for further recovery.
The THASL President called for the tourism industry to be granted export status to better reflect its foreign exchange contribution and multiplier effect on the local economy.
He also voiced concerns over the informal accommodation sector, which he believes rivals the formal sector in room numbers. He stressed the need for regulation to ensure safety, proper licensing, and tax compliance.
Shanthikumar also criticized recent increases in liquor license fees and turnover-based taxes, calling them unfair burdens on hoteliers.
He argued that the disparity in tax treatment between the hotel industry and other high-earning sectors, like banking and supermarkets, is a longstanding issue that needs addressing.
Another significant challenge facing the industry is the acute shortage of skilled and unskilled workers. Shanthikumar urged the Sri Lanka Institute of Tourism and Hotel Management (SLITHM) to ramp up training programs, particularly targeting women and youth in rural areas.
The underrepresentation of women in the hospitality workforce was also highlighted as an area for improvement.
The lack of a global tourism campaign for the past 15 years has hindered Sri Lanka’s competitiveness, according to Shanthikumar.
He pointed out that rival destinations such as the Maldives, Vietnam, Thailand, and Malaysia have implemented effective marketing strategies in key source markets. He called for urgent action to roll out a new global campaign to meet tourist arrival targets.
In closing, Shanthikumar recommended the establishment of an inter-ministerial committee, led by the President, to ensure cohesive decision-making across the 18 ministries involved in tourism.
While commending the efforts of the new Tourism Minister and SLTDA Chairman, he stressed the need for comprehensive and sustainable policy development to support the industry’s long-term success.
