Tourism Revival to Shore Up Economy-by Lakshman I. Keerthisinghe

Tourists bring much needed Dollars

Source:Dailynews

Tourism provides employment to the poorest of the poor. Gram seller earns something, auto-rickshaw driver earns something, Pakoda seller earns something, and tea seller also earns something.
Narendra Modi-Indian Prime Minister

Sri Lanka Tourism has declared 2022 as the ‘Visit Sri Lanka Year’ following the integrated five year Global Communication Campaign targeting to attract six million tourists and USD 10 billion output by 2025 in spite of the challenges posed by recent COVID spread and economic crisis facing Sri Lanka affecting the tourism industry. Travel advisories have been issued by Canada and the United Kingdom advising their citizens to restrict visiting Sri Lanka due to the country’s frequent power cuts, gas and food shortages escalating food prices. In addition to the fear of the pandemic, the present spread of dengue in the country has placed Sri Lanka in a desolate position.

The UK is Sri Lanka’s third biggest source of inbound tourists behind Russia and India. Tourism accounts for about five per cent of Sri Lanka’s Gross Domestic Product (GDP), with Britain, India and China being the main markets. Canada has also advised its citizens to keep supplies of food, water and fuel in hand in case of lengthy disruptions and to make sure to have sufficient supply of medicines in hand as they may not be available and monitor local media for the latest updates. Thus, it seems Sri Lanka is facing its all-time worst foreign exchange crisis after the COVID-19 pandemic hit the nation’s earnings from tourism and remittances.

Action plan

As a measure to overcome the worst aspect of the pandemic and the economic crisis, the World Economic Situation and Prospects 2022 (WESP) Report, produced by the United Nations Department of Economic and Social Affairs (UN DESA), in partnership with several other UN institutions, calls for better targeted and coordinated policy and financial measures at national and international levels. As discussed in the above mentioned report, national fiscal and monetary authorities need to carefully analyse and coordinate their policies to avoid sudden disruptions. This requires the complete mobilisation of the relevant Government departments, international financial institutions, credit-rating agencies and others. It appears from the report that the inefficiency in decision making of the Sri Lankan Government and not taking the required steps at the right time as mentioned on the WESP Report, have put the country in dire disruption.

The Investment Information and Credit Report Agency (ICRA) highlights that one of the most crucial factors for economic recovery in Sri Lanka, as well as globally, is the revival of tourism. Further analysing the sector’s role in economic recovery, the UN report notes that many destinations, in particular tourism-dependent countries, will need to diversify their tourism sector throughout 2022 and beyond. The report also highlights how destinations could develop domestic and rural tourism to help local economies in rural and depressed areas to boost job creation and protect natural resources and cultural heritage, while at the same time empowering women, youth and indigenous people.

Thus, it is understandable that driven by both public and private sectors, tourism is not only a source of foreign currency, but it has the potential to serve as a development ‘tool’ to strengthen supply chains, improve local firm productivity, create one out of ten jobs and provide income for women and young people. Thereby, implementing doable policies and acts to regain tourism would provide a ‘sort of hope’ to the Sri Lankan economy to increase its forex earnings.

An article published by the World Bank Managing Director of Development Policy and Partnerships, Mari Elka Pangestu on the World Bank Blog presents three clear steps for tourism to build better forward, discussed during the World Trade Organisation’s (WTO) Aid for Trade Stocktaking event last year (2021).

Accordingly, first it is very important to improve traveller confidence; second, understand and track new market trends and the drivers of demand; and third, commit to build more resilient and inclusive tourism sectors. Sri Lanka tourism has a vital role to play in creating the trust and confidence among travellers despite the on-going crisis with fuel, gas, power and essential food items, making sure tourists are under vigilant care and do not face any of the above issues while on tour in the country.

As for the second step, learning from the best practices is quite effective, thus it is required to observe the tourism programmes conducted by other competitors and new market trends and try to follow them and reinvent implementable theories and policies to the industry. Recently, Kenya’s Minister of Tourism and Wildlife Najib Balala shared how his Government is working on diversifying conservation revenue; the important progress being made in public private partnerships in conservation, and engaging in wildlife bonds, to ensure their natural heritage is protected during tourism crises. Resilience comes through focusing on the environment, people and technology to prepare for Climate Change and crises. Mainstreaming risk management and investing all along the tourism value chain is Kenya’s approach.

Re-energising domestic tourism, systematically preparing people to be resilient, embracing inevitable changes, support to the tourism business by the Government are some of the measures taken by New Zealand. India also focused on purposeful research to rebuild tourism and also focused on virtual reality trips, sustainable travel certifications and eco-labelling.

It says in Guyana, the Government, private sector and tourism communities worked together on four priorities as in, re-tooling the country’s tourism product, re-gaining the confidence of the tourism market, preparing for the new breed of traveller while also focusing on domestic tourism.

On the face of COVID-19, North America Tourism focused on the safety of travellers by reducing customer touch points by using robotics, automation and self-service kiosks and embraced Artificial Intelligence (AI) for tourism operations.

At the third stage, following global sustainable goals with local community participation in the industry is an effective strategy. Thus, offering job opportunities; making them participate in tourism programmes etc. would create a source of income for the local communities. Hence, educating the general public on why tourism is important for the country’s economic recovery should be one of the key strategies in the process of the resumption of Sri Lanka Tourism; thus the attitude of the locals will be aligned for support in tourism revival.

Foreign Exchange Reserves

Sri Lanka will target high-spending tourists to revive the tourism sector which has been shattered by the Coronavirus pandemic Sri Lanka plans to tap Indian tourists to revive the battered tourism sector and shore up its depleted Foreign Exchange Reserves. Authorities will hold roadshows starting next month in five Indian cities to attract travellers seeking “wellness, leisure, and Ramayana-trail,” tours, corporate functions and destination weddings, said Tourism Minister Harin Fernando. Ramayana is the mythological life story of the Hindu God Ram.

The worst economic meltdown since Independence, coupled with political turmoil, has hurt the nation’s tourism sector, that’s been a key driver of foreign currency inflows. Sri Lanka’s forex pile has dwindled to a meagre USD 1.89 billion in May this year as it needs nearly US$ 6 billion in the next few months to tackle shortages and support its currency.

Sri Lanka is banking heavily on multilateral institutions, including the International Monetary Fund, and friendly countries, for aid to tide over the crisis. Neighbouring India, so far, has extended US$ 3.5 billion of support in the last few months. Chennai, Bangalore, Hyderabad, Mumbai, and New Delhi have been picked for the roadshows, and hope to attract about 1 million tourists in 2022. Sri Lanka welcomed a peak of around 2.5 million tourists in 2018 before the Easter Sunday terror attacks dried up arrivals.

In conclusion, Sri Lanka must improve its tourist arrivals with promotion measures supported by its diplomatic missions abroad with its patriotic diplomats striving for the economic revival of our Motherland.