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Monday February 6th, 2023

Sri Lanka can earn more targeting experiences, sustainable tourism

ECONOMYNEXT – Sri Lanka’s tourism sector must move from promoting products and start promoting experience unique to the island’s culture and history with a focus on sustainability, a marketeer said.

“We have to package Sri Lanka in tourism in to a set of niches. We cannot do one-night stand tourism anymore,” Omar Shaqib Khan from Global Leadership Coach and Founder – Sensei International said at an event in Colombo to commemorate World Tourism day.

Citing official reports he said the average spend of tourists in Sri Lanka is 550 dollars per week.

“The way we have done is everyone spends one night in one destination and moves on to another. They are not coming to see the country.”

He says the way forward is to provide niche packages that would create experiences unique to travelers.

“We have to package Sri Lanka in to niches- cultural Sri Lanka, historical Sri Lanka, colonial Sri Lanka, hikers Sri Lanka, etc., because for each of those niches, enthusiasts will pay,” Khan said.

“But if we are only offering only products (hotels) so what? Everyone is doing. To all these must be executed.”

Along with experiences, he says the services mut follow a ‘gold standard’ from the smallest level to the highest to support the niches in the country.

“There is something called gold standard. Hospitality is warm, caring and a desire to help and Sri Lankans are the most hospitable but services are hard deliveries,” Khan said

Sri Lanka’s Tourism Development Authority had earlier planned to attract 3 million tourists with a revenue of 7 billion US dollars by 2027.

However, in the interim budget for 2022 President Ranil Wickremesinghe has set a target of welcoming 2.5 million travelers by the end of 2023 with high spenders.

This year it is expecting to receive one million arrivals and earn 1.8 billion dollars.

“In order to earn the upper echelons of earning we have to aim for the gold standards. Its a way of every perception points from arrival to departure and everything in between,” Khan said.

“Meeting or receiving expectations consistently and then hospitality is the icing on the cake but not the cake.”

Officials also called on the government to focus on sustainable tourism.

“As an island nation with extraordinary biodiversity, Sri Lanka is extremely vulnerable  to the averse effects of unsustainable tourism,” Christian Skoog, acting Resident Cordinator for UN and Country Representative for UNICEF – Sri Lanka and Maldives.

He explained that many countries looked at their tourism practices to revive the sector post pandemic.

“Sri Lanka has faced a heavy blow but the task we now face in reviving the sector also presents us with an opportunity to address some of these challenges

These include overt tourism and other unsustainable practices, contribution to the climate change, pollution, a loss of biodiversity and a lack of inclusion.”

Skoog says sustainable tourism offerings is no long a choice

“Costs incurred in adopting practices that benefit the environment and community need to be looked at as investments.”

He says this will help to differentiate Sri Lanka overall. (Colombo/Sep28/2022)

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Sri Lanka to address SME tax problems at first opportunity: State Minister

ECONOMYNEXT – Problems faced by Sri Lanka’s small and medium enterprises from recent tax changes will be addressed at the first opportunity, State Minister for Finance Ranjith Siyambalapitiya said.

Business chambers had raised questions about hikes in Value Added Tax, Corporate Income Tax and the Social Security Contribution Levy (SSCL) that’s been imposed.

It should be explored on how to amend the Inland Revenue Act, Siyamabalapitiya said, adding that the future months should be considered as a period where the country is being stabilized.

Both the VAT and SSCL are effectively paid by customers, but the SSCL is a cascading tax that makes running businesses difficult.

In Sri Lanka SMEs make up a large part of the economy, accounting for 80 per cent of all businesses according to according to the island’s National Human Resources and Employment Policy.

(Colombo/ Feb 05/2023)

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Sri Lanka revenues Rs158.7bn in Jan 2023 up 51-pct

ECONOMYNEXT – Sri Lanka’s government revenues were 158.7 billion rupees in January 2023 but expenditure and debt service remained high, Cabinet spokesman Minister Bandula Gunawardana said.

In January 2022 total revenues were Rs104.5 billion according to central bank data.

Sri Lanka’s tax revenues have risen sharply amid an inflationary blow off which had boosted nominal GDP while President Ranil Wickremesinghe has also raised taxes.

Departing from a previous strategy advocated by the IMF expanding the state and not cutting expenses, called revenue based fiscal consolidation, he is attempting to do classical fiscal consolidation with spending restraint.

President Ranil Wickremesinghe has presented a note to cabinet requesting state expenditure to be controlled, Gunawardana told reporters.

State Salaries cost 87.4 billion rupees.

Pensions and income supplements (Samurdhi program) were29.5 billion rupees.

Other expenses were 10.8 billion rupees.

Capital spending was   21 billion rupees.

Debt service was 377.6 billion rupees for January which has to be done with borrowings from Treasury bills, bonds and a central bank provisional advance of 100 billion rupees, Gunawardana said.

Interest costs were not separately given. (Colombo/Feb05/2023)

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Sri Lanka’s Ceylon Tea prices down for second week

ECONOMYNEXT – Sri Lanka’s Ceylon Tea prices fell for the second week at an auction on January 31, with teas from all elevations seeing a decline, data showed.

“In retrospect, the decline in prices would be a price correction owing to the overall product quality and less interest from some key importers due to the arrival of cargo at destinations ahead of schedule,” Forbes and Walker tea brokers said.

The weekly sale average fell from 1475.79 rupees to 1465.40 rupees from a week ago, according to data from Ceylon Tea Brokers.

The tea prices are down for two weeks in a row.

High Growns

The High Grown sale average was down by 20.90 rupees to 1380.23 rupees, Ceylon Tea Brokers said.

High grown BOP and BOPF was down about 100 rupees.

“Ex-Estate offerings which totalled 0.75 M/Kg saw a slight decline in quality over the previous week” Forbes and Walker said.

OP/OPA’s in general were steady to marginally down.

Low Growns

In Low Grown Teas, FBOP 1 was down by 100 rupees and FBOP was down by 50 rupees while PEK was up by 150 rupees.

The Low Growns sale average was down by 8.55 rupees to 1547.93 rupees.

A few select Best BOP1s along with Below Best varieties maintained.

OP1                     Select Best OP1’s were steady, whilst improved/clean Below Best varieties maintained.   Others and poorer sorts were easier.

PEKOE                 Well- made PEK/PEK1s in general were steady, whilst others and poorer sorts were down.

Leafy and Semi Leafy catalogues met with fair demand,” Forbes and Walker brokers said.

“However, the Small Leaf and Premium catalogues continued to decline.

“Shippers to Iran were very selective, whilst shippers to Türkiye and Russia were fairly active.”

This week  2.2 million Kilograms of Low Growns were sold.

Medium Growns

Medium Grown BOP and BOPF fell by around 100 rupees

The Medium Growns sale average was down by 33.40 rupees to 1199.4 rupees.

“Medium CTC teas in the higher price bracket witnessed a similar trend, whilst teas at the lower end were somewhat maintained subject to quality,” Forbes and Walker brokers said.

“Improved activity from the local trade and perhaps South Africa helped to stabilize prices to some extent.”

OP/OPA grades were steady while PEKOE/PEKOE1 were firm, while some gained 50-100 rupees at times.

Well-made FBOP/FBOPF1’s were down by 50-100 rupees per kg and more at times.

(Colombo/Feb 5/2023)

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