Business Times

Chaos in tourism

The government will be the first to deny this statement; that there is a crisis in tourism, and go on to pontificate on 'incorrect reporting based on false statements' and so on.

The hard cold fact however is that there is indeed a crisis in tourism and everyone knows it in the industry, the Ministry of Economic Development and Sri Lanka Tourism. But no one in government is prepared to acknowledge the problems, bring it out into the open and resolve it, particularly at a time when the industry and the government needs to focus, together, on improving the product.

The dirty word - corruption - is again emerging as one of the issues in the alleged deals and double-deals in the Kalpitiya tender and other locations. The fact that the Kalpitiya tender bid has been cancelled, which was exclusively reported by the Business Times, has not been officially announced. Isn't it incumbent, nay absolutely necessary and accountable for the government to announce the results of a tender instead of hiding it under the carpet?

All kinds of information is surfacing of how a senior official tried to insert some documents in the bidding process and when refused by others in a committee assessing the technicalities, had cajoled Treasury bigwigs to cancel the tender.

Shouldn't cabinet be the authority to cancel a tender? What about the time wasted by the bidders? Some of them had flown into the country in their own jets on what would now be seen as a time-wasting exercise, as some government officials wants to pick the parties themselves and sell these Kalpitiya blocks apparently for a song. Sources said that around Rs 35 million has been spent on the whole exercise including ads in overseas newspapers, etc over the past year. Who foots the bill? The taxpayer?

Cracks are showing all over: some senior officials are leaving or preparing to leave. Officers of the Public Relations division of Sri Lanka Tourism have been sent home or contracts discontinued. Some have turned down offers to come on the government payroll which is a pittance when they were delivering a private sector-styled service with long hours of work.

PR agencies contracted by Sri Lanka Tourism in the key, tourism generating countries have been told their contracts won't be extended after March. In the case of the German PR agency, its contract is ending a few days before the prestigious ITB tourism fair in Berlin in which Sri Lanka is well represented by the trade every year. Couldn't the authorities have ended the contract after the event so that the organisation could have helped in the Sri Lanka pavillion and other issues? Do these decisions make any sense?
Arguably there may be a case for discontinuing these agencies based on the cost involved and the cost-effectiveness and whether there is a sufficient return. However the timing - when Sri Lanka is going full pace to draw 2.5 million tourists by 2015 - is horrendous, to say the least.

Many other issues confront the industry. The IFFA dues totalling over Rs 100 million are yet to be paid to hotels and other suppliers, more than eight months after the event, with an audit report not being cleared by Dr Jayasundera, being the stumbling block.

Additional Secretary, Ministry of Economic Development B.Wijayaratne last month resigned in a disagreement with Treasury Secretary Dr. P.B.Jayasundera over IFFA. Now another senior official is planning to leave.

With the Treasury Secretary very busy with his work at the Treasury and Minister Basil Rajapaksa also having many subjects to handle, it has been the additional secretary and other senior staff who have been handling the reins in the tourism industry. The absence of an additional secretary has left a lot of work hanging while frustrations are growing.

The industry has also been grumbling about the imposition of the Nation Building Tax (NTB) but the government has firmly said the tax would be imposed. New five star rates in city hotels has also set off some worries in the trade. This week, a top hotelier and Chairman Renuka Hotels Ravi Thambiayah warned that the government's plans to attract 2.5 million tourists by 2015 and building the accommodation required for this inflow could lead to unplanned expansion of hotels and a price war.

The Sri Lanka Visit Year 2011 is also turning out to be a damp squib. There are no mega events so far. Even the World Cup cricket beginning in exactly a week hasn't seen that kind of vibrancy from state tourism authorities. It should have been a big carnival with mega events connected around the playing venues.

This is the third crisis faced by the industry since 2007 when Tourism Minister Anura Bandaranaike and Sri Lanka Tourism Chairman Udaya Nanayakkara clashed with the industry over the non-implementation of a new Act. Two years later, then Tourism Minister Nandana Goonatillake went on a cost-cutting spree, and reversed the distribution of funds to various sectors. He would also be remembered for scrapping the proposed 'Small Miracle' logo for which millions had been spent in creating.

Tourism needs a full time secretary and a full-time minister. The latest crisis in the industry also begs the question; why call for tenders when these are prone to be reversed. The recent issues show that credibility is rapidly going down the drain and no one simply cares.

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