Recovering from the Tourism Meltdown


As an island nation, tourism has been Sri Lanka’s bread and butter for quite some time and has provided livelihoods for many. However, the spread of the new coronavirus (COVID-19) and the subsequent responses from Nations worldwide led to a global tourism meltdown.

In an online discussion organised by the Advocata Institute, leading tourism industry heads and regulators elaborated on the impact of COVID-19 on the industry, and the way forward amidst the global pandemic.

Chairman of the Sri Lanka Hotels Association

Speaking at the discussion, Chairman of the Sri Lanka Hotels Association, Sanath Ukwatte stressed on the importance of conducting effective promotion campaigns at the first opportunity.

“Our industry was already recovering from Easter Sunday Attacks and prices fell by nearly 60 per cent last year. Towards the latter part of the year, up until about 10 March, the industry was recovering quite well. Being a capital-intensive industry, with many fixed costs, we need continuous revenue to balance this. There’s a huge glut in the market, and if we don’t come out of this crisis soon with effective marketing campaigns at the opportune time, this glut will worsen.”

He further added that one of the biggest challenges to tourism industry operators was the management of human resources during this period.

“The next challenge we face is managing human resources, today only a small team of essential staff are managing operations in hotels, whilst a majority are at home. In most hotels, senior management has taken pay cuts and others are paid their basic salaries. But the question is, how long we can go on like this. But we are still optimistic, and I have confidence our industry will recover, because it has high resilience. We’ve faced war, terrorism, tsunamis, natural disasters in the past, I can’t think of any other industry with so much resilience. When hotels were bombed last year, I thought this was the end for our industry here, as tourists fled. But gradually, it picked up in about five to six months. So, we are confident we will pull through, although this time it can even take more than six months or even a year.”

Ukwatte further highlighted the importance of having proper screening and testing to boost confidence of visitors.

“From a hotelier’s point of view, we need to revive the industry as soon as it’s safe to do so, to help maintain the livelihoods of our workers. So, we need help from the Government on how we can bring tourists to the country, without compromising the health of our people. We can do this with proper screening and testing. Our healthcare sector has given confidence to visitors.”

On a positive note, Ukwatte added that he had received inquiries and tentative bookings from next January onwards.

“Although recovery seems to be about eight months or even a year away from now, we have received inquiries and tentative bookings from January onwards. The industry is adopting a very flexible policy, where a visitor can cancel their booking any time before their arrival. We are planning to work with the Sri Lanka Tourism Development Authority (SLTDA), to give some early bird offers. We have to induce the market to travel again.”

CEO of SriLankan Airlines

Meanwhile, also joining the discussion, Chief Executive Officer of SriLankan Airlines, Mahen Kariyawasam, said that the rebound in tourism will depend on the economic wellbeing of the target markets.

“It all depends on the economic wellbeing of the passengers. Going by the job cuts and the pay reductions of the international markets, I don’t see tourism returning to the normal level, at least not in the near future. Having said that, as an optimist, I also feel that countries have to recover fast. Especially in Europe, having stick with the lockdowns etc, they might actually start travelling by this year winter.”

He further said that SriLankan Airlines will also be looking into a new business model and added that he saw new opportunities in East Asia.

“Aviation is a capacity-driven business, so we will have to look at a new business model. We intend to focus more on e-commerce, and bypass the intermediary, which will happen in the leisure and travel related industries as well. We will also be looking at our operating patterns, especially human resources, to see how best we can be competitive in the short to medium term. But we are uncertain on how one of our major markets, India will behave. We are yet to know the magnitude of the economic impact that COVID-19 has had on India, since very little data is available. So, we will have a major challenge if the Indian markets don’t recover within the next six months. However, we have new opportunities with China. They have already started the Chinese domestic carriers, same way we are expecting markets in Korea and Japan to bounce back fast.”

SLTDA Chairperson

Meanwhile, SLTDA Chairperson, Kimarli Fernando, addressing the discussion, said that industry rebound will depend on how comfortable travellers will feel, with the respective airline, destination and accommodation.

“Some airlines have already started this process, by having rapid testing for COVID-19. When it comes to destination, as a country, we have already accomplished this, by proactively managing this situation. When people start travelling again, Sri Lanka will actually be looked in a positive light because of how proactive we have been. When it comes to accommodation, SLTDA is actually in the process of making guidelines right now. We have taken Singapore guidelines and so many others, including the Health Ministry guidelines and we have a team in SLTDA working on it. We have to show, whether we can help travellers if they fall sick in our country, and I think we have already accomplished this,” she added.

Fernando further said that it was also important to look inwards, to consider how sustainable the tourist industry in Sri Lanka really is.

“In my perspective, I think we need to look internally first. This is a good opportunity for us to look at tourism again, and to look at the sustainability of tourism. When you hear even some big players saying that they can’t pay salaries for one month in this situation, we need to advice and work with the players to have a more resilient system in place. Because this won’t be the last of it, the tourism industry is susceptible to man-made disasters, pandemics, and tsunamis and many more catastrophes. Going forward, I think we will face many more obstacles as well. The goal is for industry players and regulatory bodies to help each other create a safer, resilient industry.”