Domestic tourism loses momentum in 2015 despite enticing deals

By Chandeepa Wettasinghe Sri Lanka’s domestic tourism levels dropped in 2015 and in spite of the ever increasing attractiveness of credit card and off-season deals as well as rising income levels, the hotel sector was the main casualty as more Sri Lankans looked towards budget options and overseas travel. The Sri Lanka Tourism Development Authority (SLTDA) annual report showed that local guest nights in the formal sector declined 13.93 percent year-on-year (YoY) to 2.22 million in 2015.

Of this, local guest nights in graded hotel accommodation declined by 23.4 percent YoY in 2015 to 1.59 million guest nights, even though the total guest nights grew by 4.7 percent YoY to 10.53 million due to foreign demand. An average of 1.63 million local guest nights has been recorded in hotels over the past five years, which has seen a declining trend from 1.61 million local guest nights in 2011, except for the spike seen in 2014 when the figure increased to 2.07 million, a 44 percent growth YoY. When Mirror Business contacted Tourism Hotels’ Association of Sri Lanka Chairman Hiran Cooray, he said that he was not aware of the domestic tourism trends over the past few years. The country’s hotels had depended on domestic tourism during the civil war and still rely on them in off-seasons and during patches of low foreign demand, by offering attractive credit card offers. However, several hotels, as well as regions have now discriminate against locals due to their success with foreigners. Tourism Development, Land and Christian Affairs Ministry Secretary Janaka Sugathadasa told Mirror Business that the locals are shifting from hotels into budget accommodation. “Now there are some great places with room rates like Rs.10,000,” he said. Registered supplementary establishments, which include budget options such as homestays and bungalows, recorded a 24.3 percent YoY increase in local guest nights in 2015 to 636,644 nights. Mirroring the 2014 jump in local guest nights in hotels, the local guest nights in these supplementary accommodations decreased 19.91 percent YoY to 512,017 nights.

There were no statistics available for local stays in the unregistered, informal sector accommodation, which represents over a quarter of the foreign tourism market share. The southern coast was the most popular destination for locals staying in hotels during the year, accounting for 513,973 guest nights with over two thirds of them between Colombo and Galle, followed by the ancient cities in the cultural triangle, which recorded 424,605 guest nights. Since there has been no estimate of the number of nights an individual Sri Lankan spends as a tourist, it is difficult to calculate exactly how many locals stopped or reduced travel within Sri Lanka. Meanwhile, the data showed that 1.77 million Sri Lankans travelled abroad from the Katunayake Airport in 2015, up from 1.31 million YoY and discounting the foreign labour component, which declined 12.4 percent YoY to 263,307 departures, the rest could be attributed to leisure, business, education and emigration, which have not been broken down.

A request for further such statistics, as well as an explanation why local tourism has slowed with a move towards lower quality when spending levels are increasing, from SLTDA Director General Malraj Kiriella two weeks ago, had resulted in a counterrequest for time to formulate a reply, which never materialized despite a later inquiry. However, Sugathadasa said that more Sri Lankans may be travelling abroad for leisure, into destinations such as Bangkok and staying in budget accommodations. “Sri Lankans can find good deals there just like here,” he said.