6 October 2022 03:23 am Views - 2938
With an increasing number of Europeans looking to avoid an expensive winter, due to the skyrocketing energy prices, Sri Lanka’s tourism industry is positioned to grow exponentially in the upcoming winter season, supported by the devalued rupee and recent relaxation of travel advisories, according to the latest report by First Capital Research (FCR).
Although tourist arrivals to the country recovered during the first quarter of the year, it went downhill from April, amid the Russia-Ukraine conflict, Sri Lanka’s political turmoil and travel restrictions placed by leading tourist source markets.
It was further worsened by negative media converge in foreign media, which continued to portray Sri Lanka as an unsafe destination.
However, as the Sri Lankan economic crisis and social upheaval eased up to a certain level in August this year, the European countries relaxed the advisories on travel to Sri Lanka from the latter part of August.
“The government of Switzerland, France, the UK, Sweden and Norway announced the relaxation of travel advisories to Sri Lanka, effective from August 27. The move could benefit the island to welcome more visitors from Europe for the upcoming winter season.
With the easing of travel restrictions and successful implementation of the vaccine drive, most countries have dropped the on arrival test and quarantines, regardless of the vaccination status.
Therefore, Sri Lanka has a potential to attract a substantial number of tourists and generate significant foreign currency earnings from tourism,” FCR said in its report.
Accordingly, the research house projected tourist arrivals to the country to surpass the 100,000 mark in November and 150,000 mark in December, similar to the recovery trend seen in the fourth quarter of 2019, following the Easter Sunday attacks.
In particular, it highlighted that the timing of the relaxation of the travel advisories could not have come at a better time, where millions of Europeans are looking to avoid an expensive winter in their home countries, due to high energy bills. “… while the rising energy bills in key source markets such as the UK emerges as an opportunity for Sri Lanka with millions of households indicating willingness to move out amid winter catastrophe … as a result, we expect the UK residents (and residents of other EU countries) to travel to alternative cost-efficient countries such as Sri Lanka, in order to avoid the winter season,” the report stated.
At the same time, the steep depreciation of the rupee has made Sri Lanka a rather affordable destination to many prospective travellers while offering low airfares in key source markets with its connectivity.
“LKR has depreciated over 90 percent compared to the pre-pandemic times, which made accommodation and other expenses to become more affordable for international travellers. Sri Lanka offers lowest combined cost of airline and accommodation fare for the top source markets compared to other Asian countries,” the report noted.
Although a number of Asian countries are severely hit by the global downturn and inflation, the report highlighted that Sri Lanka has been able to offer vibrant facilities to tourists at its top starred hotels at comparatively low prices (amidst LKR depreciation) in comparison to other hotels in top Asian destinations. “The average room rate in 2018 was recorded at Rs.21,607 (US $ 131). However, in today’s terms, the cost has declined to US $ 97, which implicates nearly 25 percent to 30 percent saving compared to the pre-pandemic times,” it noted.