Sri Lankan hoteliers face “suicidal” tariffs
Hoteliers in Sri Lanka believe that the increased electricity tariff is “suicidal” coming at a time when about 10-12 resort hotels in the SME sector are looking at closing operations as they continue to make losses. Promotions are the only way out.
At least 10-12 hotels in the resorts who are SMEs are looking at closing operations, Hoteliers Association President M. Shanthikumar told the Business Times.
“Every single hotel is making losses by Rs.300-400 million and we are not becoming sustainable,” he said.
Under the current circumstances “some will survive and some will close,” he noted adding that the industry will not go with a begging bowl if the promotions are carried out.
But the industry has no option but to exert pressure on the authorities to engage in promotional campaigns and insist on the digital marketing campaign to ensure the industry is able to continue.
“We got hardly any support (from the government) and so the industry is brainstorming what we should do next,” he said.
Commenting on the electricity tariff hike, Mr. Shanthikumar noted that the industry has been dealt with three blows already from the Easter bombings, the ‘Aragalaya’ and the economic crisis, added to which electricity will increase by 27 per cent.
“This is suicidal and very unfair and we are strongly protesting,” he explained insisting that this added burden towards an industry that is almost falling apart is like killing the golden goose that lays the golden egg.
Moreover, he pointed out that there is currently a severe shortage of human resources as people are leaving the industry and the country.
Hotelier Connaisance de Ceylan Chairman Chandra Wickremesinghe said the moratorium was not correctly granted when it came into effect.
Hotels under construction were also granted a moratorium on their loans but the industry believes that this benefit should have been granted only to those in operation.
Conglomerates posting high profits are also enjoying the moratorium, but they should now be asked to move out of this, Mr. Wickremesinghe explained.
He also pointed out that they are faced with the issue of staff at hotels leaving like in the case of his hotel’s chef of eight years who is now moving to New Zealand.
“This is a big problem when the kitchen staff leave,” he said.
The hotelier pointed out that they are counting on the Chinese and Indian tourists to generate revenue and boost the industry.
And with SriLankan Airlines, resuming operations to China the industry hopes to participate at the planned promotional drive there when the carrier starts its services.
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