Sri Lanka to triple hotel room supply by 2016

Nearly three years after Sri Lanka’s 30-year civil war came to an end, the country is ramping up efforts to recapture its status as one of Asia’s most popular holiday destinations.

The efforts begin with new development. Sri Lanka, a country of approximately 20 million, has fewer than 15,000 registered hotel rooms, according to the Sri Lanka Tourism Development Authority. The government wants to add 35,000 rooms within the next four years to meet the projected demand of 2.5 million foreign visitors.

But is that number attainable? And if it is, will it satisfy projected demand?

Growth during the past three years has been promising. The SLTDA estimates there were 850,000 foreign arrivals in 2011, which is 30% above the 2010 numbers. During the first full year of peace in 2010, arrivals increased 50%.

The major hurdle to growth could be visas, said HVS India associate Kaushik Vardharajan. While Sri Lanka issued tourist visas on arrival in the country through 2011, the government dropped that policy in January of this year. Most foreigners, with the exception of those from the Maldives and Singapore, must now apply and buy visas online.

Meeting visitor targets also will depend on whether the country’s new international airport in Hambantota, financed and constructed by China, is completed as projected by the end of the year, said Bill Barnett, managing director of Phuket-based C9 Hotelworks. Hambantota is located in a rural area on the south-eastern coast that is a constituency of President Mahinda Rajapaksa.

The government also must increase the number of flights and airlines allowed to serve the country, Barnett and HVS associate Inshita Wij said.

Wij said increasing the number of flights from India is crucial because Indians are the largest group of visitors, making up nearly 20% of all arrivals in recent years. Visitors from Britain follow, comprising 16% of all foreign visitors during 2010. Visitors from the Maldives and Middle East together made up about 12%.

If everything goes according to plan, however, Sri Lanka still might experience a hotel shortage. HVS India, which issued a report on Sri Lanka’s tourism and hotel prospects last summer, estimated that more than 41,000 new rooms would be needed by that date.

Not that registered and classified hotels reflect the whole accommodation story, according to statistics from the SLTDA. The proprietors of 36% of registered rooms chose not to be classified at all. For the year 2010, SLTDA estimated that close to 6,000 additional rooms were in non-registered, informal “supplementary establishments.” These include inns, guesthouses, youth hostels and homestays. Almost 20% of room nights were spent in these informal lodgings during 2010.

Susan Cunningham writes for

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