Sri Lanka formal hotel occupancy drops in 2017
Aug 15, 2018 13:15 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT- Average occupancy in Sri Lanka's formal sector hotels fell to 73.3 percent in 2017 from 74.8 percent a year earlier, reversing a 4-year trend despite increased tourist arrivals and spending in the island, provisional data from the Sri Lanka Tourism Development Authority showed.
Sri Lanka's average occupancy which was 48.4 percent in 2008 rose to 70.1 percent in 2010 and 77.1 percent in 2011 and dropped to 71.2 percent with informal competition coming on stream.
A growing informal sector of small and medium scale businesses which use innovative digital apps to compete and attract guests have been outcompeting formal sector hotels.
Formal hotels use outdated grading systems. The formal hotel lobby has been pressuring the state to curtail the growth of the informal sector.
The central bank has recently stopped finance companies from lending to informal sector tourism businesses.
All tourism businesses are now being forced to formalise through an enforcement unit.
Despite a fall in formal sector occupancy, tourist spending increased to 170.1 US dollars per day, up from 168.2 US dollars a year earlier, continuing a 10-year trend, the report said.
Tourists also stayed longer, for an average 10.9 nights in 2017, up from 10.2 nights, continuing a 5-year trend.
Sri Lanka earned 3.9 billion US dollars in foreign exchange from tourism in 2017 from 2.1 million tourists.
Another 131,409 foreign nationals arrived for excursions, spending less than 24 hours in the island. These are usually transit passengers at the country’s international airport, or cruise line passengers.
In a bid to increase occupancy and revenue during the off seasons, formal tour operators and hotels have partnered with airlines to offer budget packages to Asian markets. (COLOMBO, 15 August, 2018)