Tourism earnings stable despite revised spending methodology: Minister

Tourism Minister Vijitha Herath clarified that the country’s tourism earnings have not declined, stressing that recent concerns stem from a revised calculation methodology rather than an actual drop in revenue.

Addressing the weekly post-Cabinet meeting media briefing on Tuesday, he explained that the Sri Lanka Tourism Development Authority (SLTDA), which had long relied on spending estimates from a 2018 survey, updated its assessment in August 2025 and, as a result, the average per-day tourist spending figure was revised downward from $ 171 to $ 148.

“Tourism earnings haven’t reduced, but the method of calculation has changed,” the Minister said, noting that many countries adopting updated methodologies have recorded similar statistical adjustments.

Herath outlined that industry sentiment remains positive, with hotels operating at near full capacity during the ongoing European winter holiday season.

“If you speak to the industry, everyone will tell that their revenues have increased by many folds and forward bookings have been made for months from now,” he said, adding that although India leads in total arrivals, the majority of high-value long-stay visitors continue to come from European markets.

The Minister categorically rejected claims that tourism income has “dropped drastically,” describing such arguments as attempts to create a misleading narrative.

Sri Lanka recorded its highest-ever tourist arrivals in 2025, surpassing 2.36 million visitors. However, tourism income rose by only 1.6% year-on-year (YoY), reaching $ 3.2 billion, compared to $ 3.17 billion in 2024 (https://www.ft.lk/front-page/Tourism-revenue-lags-behind-arrivals-growth-in-2025/44-786819).

Foreign exchange earnings from tourism edged lower in January 2026 despite recording its highest-ever monthly increase in visitor arrivals, highlighting persistent pressure on per-capita spending even as the sector seeks to regain its pre-crisis footing. 

Tourism revenue fell 6% YoY to $ 378.5 million in January 2026, according to the Central Bank of Sri Lanka (CBSL). However, January experienced a 23% increase compared with December 2025, reflecting the winter holiday season. The decline came despite a 10% increase in tourist arrivals to 277,327 during the month (https://www.ft.lk/front-page/Jan-tourism-earnings-slip-despite-record-high-arrivals/44-788093).

He attributed the slower income growth primarily to the downward revision in estimated daily spending, as key factors such as inflation, rupee depreciation, and exchange rate fluctuations have been taken into consideration.

Building on Sri Lanka’s largest-ever tourism research initiative unveiled on 27 November 2025, titled ‘From Data to Decisions: Strengthening Tourism Through Evidence and Collaboration,’ in January 2026, the country’s first Rapid Assessment of Economic Leakages, conducted by the SLTDA with technical support from UN Tourism, estimated that the country loses $ 1.13 billion annually through leakages, despite generating over $ 3 billion in tourism earnings (https://www.ft.lk/front-page/Tourism-leaks-1-13-b-annually-as-focus-shifts-from-arrivals-to-value-retention/44-787631).

The study, focusing on accommodation, inbound tour operators, and the wellness/Ayurveda segment, underscores the need to retain greater value within the domestic economy and attract higher-spending visitors.

According to the 2025 survey, independent travellers spent an average of $ 148.26 per day, distributing their spending across local eateries, transport providers, and community-based services. Russian tourists led spending among non-packaged visitors.

Package tourists spent significantly more, averaging $ 214.9 per day, with the UK market and travellers aged over 60 driving higher-value structured travel.

Minister Herath said the updated methodology significantly enhances the reliability and credibility of tourism statistics, describing it as “one of the most robust tourism datasets produced in recent years.”

While arrival numbers remain strong, he said they are now increasingly focused on improving value capture, raising per-visitor spending and reducing economic leakages to ensure sustainable sector growth.