Picking the right tourist

Plans by the Economic Development Ministry to sponsor over a 100 Chinese tour agents this year to Sri Lanka needs to be looked at in the light of industry requirements.

The shiny target of 2.5 million arrivals by 2016 can certainly be bolstered by more Chinese tourists, but ensuring that they are high-end customers remains a challenge. Moreover, as recently as December, a 100 Chinese nationals were arrested in Sri Lanka and subsequently deported on financial fraud charges, raising questions over the management and security of encouraging unlimited Chinese tourists.    

While the increased numbers are laudable, it is clear that there are still steps that need to be taken to ensure the sustainable growth of tourism in the country.

Sri Lanka’s tourist businesses are charged a ‘cess’ by the State tourism agency, and the industry has been calling for a well-funded destination program since the end of the war. Industry heavyweights even made the suggestion to Treasury Secretary Dr. P.B. Jayasundara ahead of the 2013 Budget, but received no positive response. This ‘wait-and-see’ policy has raised fears that Sri Lanka could lose ground to more competitive emerging destinations such as Cambodia, Laos and Myanmar.

Authorities have generally said that with a strong influx of tourists, a large marketing program was not needed, especially since Sri Lanka does not yet have enough rooms. Instead, tourism promotion has relied on internet campaigns and promotions targeted at specific markets, which cost less money.

Tourism authorities have been focusing on expanding infrastructure as the target of 2.5 million tourists by 2016 requires more resources and many felt that the natural publicity generated by the end of the war would be sufficient to keep numbers afloat.

Mentions by Lonely Planet and the New York Times aside, the island has struggled to remain in the media for positive reasons. The lack of a destination marketing campaign could also mean that Sri Lanka will continue to lag behind in the race for high-end clients. This would mean that the returns on tourism, on which the Government has high hopes, would take longer to materialise – or may not materialise at all.

The growth and sustainability of such numbers is largely dependent on the vibrancy and continuity of arrivals. Earnings of local players also leaves limited funding for large-scale marketing programs, resulting in sporadic or limited exposure. A comprehensive destination marketing project would assist all players in the industry – from the small to the large.

The Central Bank has kept an optimistic US$ 2 billion target in Foreign Direct Investment for 2013, with half expected to come from tourism. Yet, there are tough questions being asked on the transparency front. The infamous Galle Face CATIC land scandal is still fresh in the minds of the public and to add to that, there are now issues over the payment of US$ 450 million from Krrish Group, with Opposition parties calling for the Government to cancel the agreement if payment schedules are not met.

Great expectations can only bear fruit with great commitment. This means that both the private and public sector need to work together so that the industry achieves its full potential. Per capita income of tourists, better market research, introduction of new products, promoting environmental sustainability and having more transparent investment deals are all part of the challenge for tourism.