Crunching numbers in tourism
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Before aiming for a phenomenal 3 million tourist arrivals this year, as promised by the Minister of Foreign Affairs, Foreign Employment and Tourism Vijitha Herath, shouldn’t we consider whether the carrying capacity – the number of tourists that the country can cater to, based on its resources – is adequate?This was the discussion I had with Ruwanputha, a young economist, when he called on Thursday morning. “Are we going too fast in speeding up tourist arrivals,” he asked. “That’s a good point. Another issue is whether we are too set on numbers. Should we focus on quality as opposed to quantity,” I said in response.
“We can create a good product and for this all stakeholders need to come together and assess the potential for tourism, its opportunities and whether our infrastructure is adequate for high arrival numbers,” he said. “You’re right. The governing authorities and the private sector including smallholders need to discuss the future of tourism before it reaches breaking point,” I said.
Arrivals are rising to record levels. Sri Lanka is aiming for an ambitious 3 million tourist arrivals, up from a record 2.36 million in 2025 – higher than the previous record of 2.33 million achieved in 2018. But earnings from tourism were lower at US$3.2 billion in 2025, compared to the 2018 figure of $4.48 billion.
The lower revenue in 2025 (even though arrivals were higher) against 2018, was because a tourist spent $174 per day then, whereas it was $148 in 2025. With a proliferation of guesthouses and low-cost Airbnb-type accommodation over recent years which sell below $50 per day compared to $125-150 in the upper-end hotels, the daily spend has come down. The informal sector represents close to 40 per cent of the industry.
Meanwhile, the facilities at the Bandaranaike International Airport (BIA) are at breaking point. The single arrival and departure terminal is filled to capacity with long queues at ticket counters (departure area) and the arrival area is also visibly crowded.
Last week, I was at the BIA arrival lounge to welcome a Sri Lankan couple and what I witnessed was very disturbing…if we are to grow in tourism. The terminal is crowded with representatives of travel companies, hotels or FIT (free-independent-travellers) carrying name boards to greet their guests. They were virtually falling over each other, in a bid to get in front of the waiting crowd. Tourists spent time walking up and down for several minutes trying to check out dozens of name boards in the crowded first row.
While this appears to be a common practice in most airports, why not fine-tune this process to eliminate congestion in the arrival lobby? Neighbouring Maldives has an interesting concept where all hotels have their own counters and tourists can walk to that counter and check out their booking and transportation.
One suggestion is for the BIA to have a counter and a screen displaying the agents waiting for their clients. Tourists can then check in at this counter and speedily locate their agent without having to check dozens of name boards.
The terminal upgrade to reduce congestion – Sri Lanka is building a second terminal to accommodate an increased number of arrivals with the total capacity from both terminals increasing to 15 million from the current 10 million – has also been delayed. The Japanese-funded project was suspended following Colombo’s announcement in April 2022 of defaulting debt repayments.
This project has also been mired in controversy during the tender process, with accusations of favouritism swirling around in the government’s influential corridors of power, annoying the Japanese authorities.
A positive development, however, is the installation of four New Automated Border Control Gates (e-gates) at the arrival lounge, for the moment for Sri Lankan passport holders.
Popular tourist sites including the Yala national wildlife park, the Heritage Site of Sigiriya and The Gathering of elephants at the Minneriya wildlife park are already overcrowded and the authorities need to come up with a game plan to streamline the process before it becomes difficult to even sight the animals.
Hoteliers are also cautious about reaching the magical target of 3 million arrivals, saying that the lack of a destination marketing campaign – delayed for many years – is likely to forestall the country’s forecast.
Hiran Cooray, chairman of the Jetwing Symphony group of hotels, believes it is better to target a 10 per cent increase this year to around 2.6-2.7 million because the stumbling block in achieving a higher figure is the delay in launching the long awaited-destination marketing campaign.
“We have not had a marketing campaign for years which if done sooner than later, will propel tourism revenue, increase prices not only for the big hotels but also smaller guesthouses. A positive impact will be felt across the board,” he reiterated, adding that his company spends a lot on its own marketing in the absence of a national campaign.
There is a twofold problem in finalising a destination marketing campaign: The preparation of a campaign goes through a time-consuming, rigorous and lengthy state procurement process, and secondly, even once it is approved if the government changes, at that time, the planners are back to square one as politics dictates policy over national priorities.
The authorities are also closely looking at tourism leakage with a survey that has been done with the help of a consultant from UNWTO (the UN tourism body), according to Udana Wickramasinghe, Director/Research & International Relations at the Sri Lanka Tourism Development Authority (SLTDA). Tourism leakage refers to the loss of revenue that doesn’t stay in the local economy owing to a large component of imported items used in the industry, instead of local products.
“We are planning to have a workshop for all stakeholders to discuss these findings and see where we can enhance the local component in the industry, like for instance hotels using local wines and alcohol, local meat and cheese, local furniture and fittings instead of importing these items which can help to save foreign exchange,” he said.
In winding up, I missed a popular flavour in this column – the gossip by the trio sitting under the margosa tree. Apparently Kussi Amma Sera, Mabel Rasthiyadu and Serapina had gone to the Buddhist temple, interestingly on Thursday when Tamil Hindus celebrate Thai Pongal – the harvest festival.
The wish-list today is that the different stakeholders sit together and consider which is better (given the country’s limited resources and carrying capacity) – rising numbers or limited numbers with a higher spend.
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