ISSN: 1391 - 0531
Sunday October 7, 2007
Vol. 42 - No 19
Financial Times  

Lifeline for tourism

There is no doubt that tourism is in the doldrums. However in recent weeks there has been some positive news for the industry that should lift the spirits of any struggling operator, travel agent or hotelier.

The best news last week was the promulgation of the New Tourism Act which provides a more effective public-private sector partnership in the management and control of the tourism industry and the taxes that it generates.

In future, the private sector is expected to have a bigger say in the distribution of these funds as per changes in the Act.

The industry has been clamouring for a long time for a bigger stake in a share of the funds because most of the promotion of the country has been private sector-driven. In fact global operator Neckermann featuring Sri Lanka on the winter cover of its brochure saw this company footing half the cost of the advertisement while the balance came from Sri Lanka. That exposure is providing a huge boost to the country inspite of the current situation.

Also on the positive side is that the main Western European markets like France, Germany, the UK and Netherlands are ‘softening’ their travel advisories – as the security situation improves -- easing constraints on travel agents in selling tour packages.

Some big European operators some weeks back also reported a favourable booking response for the winter season in Colombo indicating that come December - the hotels won’t be as badly off as last year.

However in the past week, some markets like Italy are not reporting that good a response. Be that as it may, the other good news is that John Keells is taking over the Confifi Hotels, a positive sign in the industry given the solid management of the JKH group and its success in the leisure industry.

Confifi has been going through troubled times mainly stemming from several lean seasons over the years precipitated by the tsunami and its aftermath. The problems have been compounded by the differences between Prof. M.T.M. Furkhan and his son, Stefan who preferred a more aggressive strategy as against what is seen as a conservative strategy by the older Furkhan.

However the fact that JKH stepped in and would run one of the oldest hotel groups in Sri Lanka bodes well for the future of tourism and shows that there is still a lot of life in an industry that the Central Bank recently dismissed as nearly irrelevant to the national economy! The older Furkhan is one of the first resort hoteliers in the country, setting up Confifi in 1970, just three years after the development of Bentota as the country’s first tourist resort.

While a lot of credit in the revival of the industry – through administrative and ground level policy changes (amidst the political turbulence) – must go to Tourism Minister Milinda Moragoda and Tourist Board Chief Renton de Alwis, luck has also been in their way due to a plethora of international conferences and sports events that has brought in a decent share of visitors.

The International AIDS Congress which saw city hotels fill up in August and this month’s tour of the English Cricket team, among other events, have helped boost arrivals.

The new boards of management of different areas of the industry chaired by men of the calibre of Ken Balendra, retired Foreign Secretary H.M.G.S. Palikkahara, retired civil servant M.D.D. Peiris, Lalith De Mel, Renton de Alwis and Prema Cooray among others, supported by successful young hoteliers like Hiran Cooray and Abbas Esufally, will add strength to the industry as it raises its head from a never-say-die position.

As one hotelier said last week, “There are crises all over the world including many parts of Asia. Sri Lanka is not alone in such a situation and we can revive tourism and make it work.” The private-public sector tourism partnership in Sri Lanka thus is on the right track and will work as long as politics and conflict do not get in the way.


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