Tourism earnings soar to nearly $ 1.5 b by end of 3Q

Sri Lanka’s tourism sector has surged ahead in 2023, with earnings totalling nearly $ 1.5 billion in the first nine months of the year, alongside a notable influx of over 1.01 million visitors.

The latest data from the Central Bank reveals that tourism earnings in the third quarter of 2023 were over $ 1.45 billion, reflecting a staggering 67% surge from the corresponding period of last year. 

September earnings stood at $ 152.2 million but witnessed a 28% dip from August. This dip is attributed to September falling short of its monthly arrivals target. 

In a month-to-month comparison, both August and September fell short of their monthly arrivals target, despite July surpassing projections and generating a remarkable income. This $ 219 million makes July the highest monthly earnings of 2023 thus far.

Separately, a faction of the industry contends the data highlights a pronounced decline in earnings since the announcement of the minimum room rate (MRR) in June, signalling the impact of this policy shift on the industry’s revenue streams.

“The dip in earnings unequivocally indicates that the enforcement of MRR has had a substantial impact on the industry as a whole. This demonstrates that visitors were quite sensitive to the price hike introduced to the city hotels and has impacted the high earning segments like MICE tourism,” they argued.

Despite enduring significant challenges following the Easter Sunday attacks in 2019, Sri Lanka’s tourism sector has not only weathered the storms but emerged more robust. This resurgence is vividly reflected in the surge of arrivals, which reached an impressive 1.01 million in the first nine months of 2023, a stark contrast to the crisis-ridden figure of 29,802 in 2022. However, when benchmarked against the pivotal year of 2018, the industry still grapples with a 25% deficit.

Analysts view this upward trend in arrivals as a promising sign for an industry that has navigated a series of hurdles over the past three years. With cautious optimism, Sri Lanka Tourism is intensifying efforts to further stimulate the sector, to regain pre-crisis levels of activity in the coming years.

Sri Lanka Tourism’s anticipation is running high for the winter season, as the sector sets ambitious targets of welcoming 1.55 million visitors and generating over $ 3 billion in income by year-end. “Achieving these milestones would mark a significant triumph in the industry’s path to recovery,” analysts said.

Source: Tourism earnings soar to nearly $ 1.5 b by end of 3Q | Daily FT