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Minimum Room Rate will not remain for long: Harin

8 December 2023 09:19 am - 23     - {{hitsCtrl.values.hits}}

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  • Says MRR was brought in until the market stabilised
  • Admits after MRR Colombo hotels occupancy dipped by 16%
  • However, he says the move helped increase revenue by 25%

Tourism Minister Harin Fernando this week signaled that the recently reintroduced Minimum Room Rate (MRR) for Colombo city hotels will not remain for long, and the industry is expected to operate based on market forces.
Acknowledging that President Ranil Wickremesinghe wants the MRR removed, Fernando asserted that the policy was brought in only until the market is settled, and there were no firm plans for it to continue for a long time.
Addressing the parliament this week, Fernando justified the move to bring in the MRR by pointing out that the rationale behind it was to allow the hotel sector some breathing space in managing expenses.


“We had a serious problem in retaining staff, and we had to keep the service charge. The moratorium was coming to an end and the hotels had to start paying their loans. So these were the real factors. We listened to the hotels association and increased it (MRR). Not because we wanted it,” he said.
Fernando pointed out that since the MRR went into effect on October 1, revenues have increased by 25 percent. However, he admitted that occupancy in the Colombo city hotels has contracted by 16 percent within the same period. “So there was a give and take there,” he said.

The Minister stressed that Sri Lanka must not compete or compare itself with countries such as Malaysia and Thailand, primarily because Sri Lanka has limited hotel rooms.

He reiterated that the MRR was re-introduced to bring some form of stability to the industry for a short period of time.

Meanwhile, two lawsuits have been filed against the Sri Lanka Tourism Development Authority (SLTDA) and the Ministry of Tourism regarding the MRR. The Supreme Court commenced hearings on the cases yesterday, with the next session scheduled for Monday (11).


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  Comments - 23

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  • Shalani Tharaka Friday, 08 December 2023 09:26 AM

    Only in SL, so stupid.

    ERAN Wicks Friday, 08 December 2023 09:27 AM

    Blunder of Asia, small debacle, so corrupt, waste of paradise.

    Sivalingam Friday, 08 December 2023 09:28 AM

    Idiots, minimum rates only in SL, no one practices.

    Lionel Friday, 08 December 2023 10:20 AM

    These idiots have no idea when it comes to tourism. He says he can't compare against countries like Thailand and Malaysia. Then, is he going to compare against, Australia, USA, Canada? I can tell you even in those countries, hotel rooms are cheaper and of more variety than in SL. On one hand, they want to plead tourists to come to SL, on the other hand, they want to kill the goose which lays golden egg. Stupidity in everything they do. How can this wonderland become a developed place?

    Mokan Friday, 08 December 2023 10:33 AM

    I stayed in Colombo hotels recently, the occupancy was so low

    Waco Friday, 08 December 2023 10:40 AM

    These fellows carry coconut above their shoulders. No any forward planning for the development of platoon industries or Agriculture. Pack up and go home.

    Fed up Sri Lankan Friday, 08 December 2023 10:49 AM

    What a brainless spin story to cover up an absurd and costly decision by this ill advised Minister! He obviously thinks that all the Citizens of the country are as naive as he is! Admit the mistake and make responsible people accountable; that is far better than looking like a fool on your own.

    Ram Friday, 08 December 2023 11:09 AM

    Why must the government get involved in the minimum or maximum room rent. It must be left to the respective hotels. If they wants to give room free that is their wish. Soon we might see government dictating what rent to charge from tenants!

    chux Friday, 08 December 2023 11:28 AM

    stupidity at its best

    Ceylonese Friday, 08 December 2023 11:29 AM

    Recently I was on holiday in Sri Lanka where frnom the moment I landed at my hotel and my exit I was dishing out money like an ATM machine to everyone who helped me with my luggage etc. and sported a friendly smile. There was qute a scuffle between the staff to grab my luggage merely to get a tip that eventually proved to be a real nightmare. It gives a very poor impression to the tourist about Sri Lanka and needs to improve.

    Roger Friday, 08 December 2023 01:09 PM

    100% agree. My experience is the same. I made a point to do my own things by myself. Hotel prices, food and drinks are high enough, why would I dish out some more mo ey for nothing to all those people.

    Christo255 Friday, 08 December 2023 11:43 AM

    Bullshit. Colombo has too many rooms with even hotels like Sheraton about to open.if we have limited rooms how come none of the hotels have 100% occupancy?

    Quolp Friday, 08 December 2023 12:48 PM

    It is high time to remove you guys talking too much by your birdbrain.

    Observer Friday, 08 December 2023 01:49 PM

    If tourist board make conditions as such as “ Don’t visit Sri Lanka unless you can spend USD 100 per day” Fair enough . Then all the problems is solved and Traveller find other destinations.No unnecessary discussions.

    NV JEN Friday, 08 December 2023 02:38 PM

    Typical reflection of Sri lanka. Policy blunders without understanding market forces or people's pulses. When the incompetent rule, strategies suffer.

    Dee Friday, 08 December 2023 03:58 PM

    Now he wants to remove minimum rate and that too has so much negative comments! Wonder what our bird brain people really wants?

    Pound foolish, penny wise Friday, 08 December 2023 04:05 PM

    When we visited SL in March this year Hotel Kingsbury quoted US$80-85 (via a close contact). In November this year they quoted US$157 via the same contact. We stayed with friends and enjoyed their hospitality. Not only did the hotel lose out I even got to keep the tip money.

    Nishan Friday, 08 December 2023 04:18 PM

    They want minimum rate removed and tax payers to subsidise their electricity, water and even the loan interests. They have to stop hoarding money due to MRR. Let them find a sustainable model without burdening tax payers.

    Dan Friday, 08 December 2023 04:30 PM

    On the one hand we have an open economy. Prices to be determined by market forces. On the other hand we have minimum or maximum prices for anything from hotel rooms to an egg.

    Fernando Friday, 08 December 2023 04:34 PM

    First of all SL tourism industry must learn about Star system of hotels. A 4 Star hotel in SL is nowhere near 1 or 2 star hotels in other parts of the world.

    Perera Friday, 08 December 2023 04:41 PM

    If you want to improve tourism in this country, why not build quality roads to Riverstan in Matale, Ohiya Kalupahana road and Nunperial mountain road. Most of the beautiful places are non-accessible due to the bad conditions of the roads.

    Banda Friday, 08 December 2023 05:43 PM

    Dont do always what Hotel Association want you to do. Listen to them and implement what country need to do. Learn from other successful countries and learn. RW is correct here. Remove these stupid barriers and ask hotels to compete with market forces. It is up to them to stay in the competition.

    Mohamed Burhan Saturday, 09 December 2023 07:13 AM

    I totally agree with Ram.Their should be a standard charge collectively agreed by Hotels corporation if their is one now.Some hotels visited by regular clients both local and foreign.left to this hotel to give a rate reduction if possible which must be happening for decades.This is left to this hotel mansgement.after all this is his hotel and he decides the hospitality and service he gives to his regular clients. Who knows by doing this to keep his regular clients he may be bearing a further reduction in his profit margin.otherwise this client will try another hotel .we must take into note the word hospitality is really appreciated in Sri Lanka from a foreigner is first started from the service of a 3rd star or 5th star hotel


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