Towards 2016 – Meeting Tourism Targets

Voice of Europe!

By Alexandra Delaney

The British love a good holiday and each year we Brits temporarily flock to warmer climes in search of the elusive sun. Despite the doom and gloom of a recession that seems to be overshadowing life for many, the British still managed to spend a record £12.4 bn on our foreign holidays last year (an increase of 2% from 2010).
Although European destinations are the most popular for British holidaymakers, with 53% of Brits planning a European holiday this year, we’re not afraid to travel a bit further in search of sun, sea and sand.
In Sri Lanka, British tourist arrivals for the month of May were up 11% from last year’s figures, with 4,940 sun-seeking Brits choosing the island as their destination of choice.
This is great news for the Sri Lanka Tourism Development Authority (SLTDA), which has set annual targets of 2.5 mn tourist arrivals by 2016, expected to result in foreign exchange earnings of $2.75 bn.
A stable political environment, coupled with strong year-on-year economic growth, is repairing not only Sri Lanka’s tourism reputation as a tropical holiday destination of choice, but also as a credible sector for European investment.
However, Europe’s grim economic climate has made us Brits more cautious with exactly how we splash our cash, and this austerity seems somewhat at odds with the government’s 2011-2016 National Tourism Development Strategy which aims to attract the big-budget spenders and upgrade high-end facilities accordingly. 22% of Brits reveal that their destination decisions will be influenced by the recession, meaning that fewer will be willing to indulge in the 5 Star facilities that currently dominate the market.
There is currently a duality in the categories of tourists visiting Sri Lanka; a split between the 5 star spenders and the budget-backpacker brigade.
Europe’s middle-classes (the vast majority of international tourists) fall into neither category and yet these are the tourists who will return year-on-year with their families. For Sri Lanka’s targets to be sustainable, the tourism sector needs to not only attract these tourists, but also provide an experience of such quality that tourists will return.
There are also still basic issues to be addressed in order to bring the sector in-line with international standards.
In parts of the country, infrastructure is severely lacking and road infrastructure leaves a lot to be desired (and will be a deterrent to visiting areas of the island). Hotel rooms, also, are in desperate need of modernisation, and industry-wide standards should be implemented to ensure quality and consistency.
Transportation issues, a key barrier to making the long journey to the Eastern coasts, need also to be resolved in order to attract tourists island-wide; at present, there are infrequent, expensive flights from Colombo to Trincomalee.
“Europe together with the UK contributes over 50% in terms of tourist arrivals and significantly higher in absolute value terms”, states Jetwing’s CEO, Trevor Reckerman, demonstrating the industry’s reliance on European tourists. European investment in the sector will certainly improve confidence among Western holidaymakers.
The untapped potential of the North and East is vast, agrees Trevor Reckerman.
“Increasing accessibility and an alternate season has the potential to make the East coast an attractive new destination bringing prosperity to the people in that part of the island,” he states, adding that Jetwing announced their plans a year ago to commence construction of luxury resorts in Jaffna and Trincomalee.
The government’s commitment to promoting tourism in these areas is clear. In line with their 2011-2016 strategy, four Resort Development Zones have been identified in Kalpitiya, Pasikudah, Dedduwa and Kuchchaveli. To compliment these, the generous tax breaks offered by the BOI provide numerous investment opportunities for European enterprises to venture into Sri Lanka in a variety of spheres, including hotel investments, inbound trade for the provision of goods, food and beverages, public procurement initiatives in much-needed infrastructural improvements and even improving tourism industry service standards through training academies.
It’s certainly an optimal time for investment and Trevor Reckerman agrees: “Sri Lanka is coming out of a prolonged hiatus and thus the concessions that accrue now will not remain forever.”
Putting it simply, he adds, “The early bird gets the worm it is said and the time for Europe to venture overseas is nothing short of now!”

ECCSL Recommendation:
For Sri Lanka
• The perspective cited herein is of a business support organisation that is keen on enhancing and facilitating greater trade and investment opportunities between Sri Lanka and the European Union. Therefore, in the interest of attracting more European tourists, have herein cited the above.
• ECCSL is of the opinion that through the formulation of European – Sri Lanka Tourism stakeholder committee, the business community and all key stake holders should effectively support the GoSL in its forward strategy through EU Business to Government dialog forum.
• A multi pronged survey amongst incoming tourist (end users), travel agencies (intermediary organizations) would enable the GoSL to identify gaps of customer demand versus the actual supply to be addressed effectively.
A value added component within the tourism sector is the
tourism entertainment sector. A social responsible, well regulated sector; benchmarking countries that have excelled in brining the balance required.

For the European Union:
• The development strategy provides investment opportunity for European Organization to venture into in Sri Lanka. In brief opportunities arise in the spheres of:
• Investment in hotels in the form of Small, Medium or Large investments (boutique, guest house, luxury hotels);
• Inbound-trade opportunities for provision of goods and services offered by 5 star and boutique hotels in the pre set up process. (i.e. construction sector opportunities in service , machinery and equipment);
• Inbound-trade opportunities for provision of goods and services offered by 5 star hotels and the post set up process. (i.e. niche food and beverage sector and limited access to goods);
• Interconnected GoSL identified development plans on public procurement initiatives in infrastructure initiatives (roads, bridges, waterways, etc. ) to increase tourism;
• Opportunities for private investment in enhancing the capacity of Sri Lanka’s tourism industry’s related service standards, including setting up a high-end school for tourism.