Sri Lanka ‘s tourism target tumbling off target
Sri Lanka’s unprecedented growth in international tourist arrivals over the last three years was no marketing magic, rather the gushing release of pent up demand that had been kept bottled for 30 long years of the war on Tamil Tiger terrorism.
The end of the war in 2009 was the release of the genie. The island’s travel industry, led by the Sri Lanka Tourist Development Authority (SLTDA), however, seems to have mistaken this peace dividend as a natural phenomenon that would go on forever, like the ‘Energizer Bunny’ in the TV advertisement for Eveready batteries.
Tourist arrivals have slumped this year (in growth terms) and as of October 2013, it is doubtful that the SLTDA will reach even its revised target of 1.2 million arrivals this year, making it near impossible to reach the much touted target of 2.5 million arrivals by 2016. It now appears that the SLTDA is targeting an annual increase of around 200,000 tourists per year, in absolute terms, in which case Sri Lanka will be ending up with only 1.8 million tourists by the year 2016, not the 2.5 million, originally targeted.
Reasons for failure
It is now pretty obvious that Sri Lanka’s tourism policy planners and plan executors did not get their basics right. When the government set a target of 2.5 million to be achieved by 2016, the calculation was apparently from a base-year figure of around 450,000 in 2009, when the war on terror ended.
However, what the SLTDA pundits failed to realize was that the target would not be achieved by braggadocio, but that it needed the government to create the business friendly habitat necessary for growth. So, let’s see what went wrong.
I checked out former Tourist Board Chairman, H.M.S. Samaranayake’s (HMSS) keynote address at the recent inauguration of Colombo University’s post graduate degree programme on Tourism and Hospitality Management, wherein he outlined his thoughts on the prerequisites for achieving the 2016 target;
1. It implied an average growth rate of 30 per cent per year over the seven year period from 2010 to 2016. On an exponential growth trend, or an increase in arrivals by 285,000 each year, over the 7-year period (on a linear growth trend).
2. It required construction of an additional 30,000 rooms over the seven year period from the base figure of around 14,000 rooms that were in operation in 2009 or, in other words, the construction of around 4,300 additional rooms, per year, during the 7-year period.
3. The manpower training needed at all levels to run the new hotels coming into operation every year was to be around 8,000 per year.
4. In order to ferry the additional 285,000 tourists visiting the country each year, the additional air flights needed to be promoted was to be in the region of 27 per week, each year.
5. It was also necessary to improve and upgrade the country’s general infrastructure, as well as tourism specific infrastructure, to cope with the growing demand from the tourism sector.
Tourism Master Plan
Sri Lanka started its tourism development in 1966 by commissioning a consortium of multi-disciplinary consultants to draw up a 10-Year Tourism Development Master Plan (from 1967 to 1976) to guide tourism authorities and the industry.
A similar Master Plan to guide the future development, immediately after the dawn of peace, should have been drawn up because of three main reasons:
1. The country was returning to peace after 30 years of war, giving a new lease of life to tourism development.
2. The Northern and the Eastern Provinces, which cover one-third of the total land area and two-thirds of the coastline, hitherto closed for tourism activities, became available for tourism development.
3. The high priority given to tourism development by the government as a peace dividend, by fixing a very ambitious target of 2.5 million tourists during a 7-year period.
Sadly, such a Master Plan for tourism development for the country, including the newly liberated Eastern and Northern provinces never appeared, despite the World Tourism Organization (WTO) having fielded a support mission to prepare the Terms of Reference and requested government approval to field a Multi-Disciplinary Team of Consultants – both international and national – to prepare the plan. “But that approval never came,” laments HMSS.
Yet the government is crowing about the ambitious target of 2.5 million, without having a well formulated National Plan, at least to work towards that target. HMSS decries what he perceives as “everything now seems to be done on an ad hoc and haphazard basis”. The government’s policy of selling land to hotel developers at a price of Rs. 20 million per acre appears to have retarded hotel development. The net result is that hotel development lags behind. There was only an addition of around 1,000 rooms to the total hotel capacity during the last three years, from around 14,500 in 2009 to around 15,500 in 2012, when the country needed around 4,000 additional rooms every year.
The SLTDA operates under the notion that peace alone would be sufficient to bring the projected numbers of tourists, without sustained tourism promotions in the traditional source markets and instead, operating transient promotional caravans in non-tradiional markets.
Human Resource Development
When it comes to human resources needed to service an expanding tourism industry, the situation is the same. There is no well-conceived Manpower Development Plan. In an article authored jointly by Chandana Jayawardena and Sirilal Mithrapala, they assess that the present output of around 2,500 trainees by the SL Institute for Tourism & Hotel Management (SLIT&HM) and its Satellite Schools alone cannot provide the manpower requirements of the Sri Lanka hotel industry, even to meet a revised tourist arrivals target of 1.9 million by the year 2016. They have stressed the need for promoting other training institutes like the universities to produce the manpower requirements of, not only the accommodation sector, but also the other sub-sectors of the tourism industry. However, though lagging in areas of tourism product development, marketing and human resources development, the government has excelled in infrastructure development; both general and tourism specific. If tourism product development, human resources development and marketing went hand-in-hand with the infrastructure improvements, Sri Lanka would be better positioned to reach the target of 2.5 million tourists by 2016.
Recent tourism trends
In the past Sri Lanka depended heavily on European tourists, who accounted for more than two-thirds of the total traffic. They came mainly for beach oriented holidays, with one/two week beach stay and one week of site-seeing.
Now, we are getting more and more tourists from the Asia-Pacific region, particularly from India and China. They come not so much for beach holidays but for activity oriented holidays. Their needs and behaviour are very different to those from the West and, therefore, the country must gear itself to service their requirements. This is needed, particularly in the area of tourist guides training.
Another important change is the phenomenal increase in domestic tourism, particularly to the Eastern and Northern Provinces. As much as 2.1 million guest nights recorded in ‘Registered Tourist Hotels and Supplementary Tourist Accommodation Establishments’ (like guest-houses, tourist bungalows) have been by the local residents. This is more than 25 per cent of the occupancy recorded in all registered accommodation establishments.
It means, more than one million local residents (or 5 per cent of the total population of the country) have travelled within the country and stayed in the so-called expensive tourist hotels. One can imagine how many more locals would have travelled within the country and stayed in other types of accommodation, operating outside the SLTDA’s registration scheme.
It follows that more and more local residents have begun to use the facilities and services provided by tourist hotels, which were earlier meant essentially for the use of foreign tourists. As a result, banqueting and other services provided by these tourist hotels have become equally important as room services. This factor needs to be taken into account when planning for human resources development for the tourist industry.
(The writer thanks H.M.S. Samaranayake for permission to use data and his views.)
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