Tourism Minister urges formalisation of informal sector to boost visitor experience

• Says such establishments miss out on the benefits of being part of the formal sector
• SLTDA Chief says efforts underway to restructure tourism agencies

The need to bring more informal tourist establishments into the formal sector has come under fresh focus, with newly appointed Tourism Minister Vijitha Herath stressing the importance of ensuring their registration.

Pointing out that many businesses in the tourism sector still operate as unregistered entities, Herath highlighted that these establishments miss out on the benefits of being part of the formal sector.

Formally incorporated businesses in the tourism sector and those registered with the Sri Lanka Tourism Development Authority (SLTDA) stand to reap many benefits, a key one being support from the government during crises, such as the pandemic in 2020 and the subsequent economic downturn.

The registration of tourism businesses also ensures the standardisation of services offered, which helps improve the overall experience for international visitors.

Addressing the 59th AGM of The Hotels Association of Sri Lanka (THASL), Herath noted that while tourists spend an average of US$169 per day with an average duration of stay of eight days, the experience offered is not necessarily up to the mark.

“The numbers are encouraging, but we must focus on enhancing the overall quality of visits and increase economic benefits for the country,” he said.

Herath assured that the government is committed to positioning Sri Lanka as a top sustainable tourism destination and ensuring it becomes a leading revenue-generating sector. However, he acknowledged that several challenges remain.

The key challenges include poor coordination among industry stakeholders and relevant agencies, limited use of technology, over-reliance on traditional tourism models, and low public awareness of tourism’s potential.

“There is a need to move beyond traditional sightseeing and offer unique, authentic experiences,” he said. “The government is committed to building partnerships, simplifying regulations, and ensuring a seamless experience for tourists from arrival to departure.”

Meanwhile, SLTDA Chairman Buddhika Hewawasam said efforts are underway to restructure tourism authorities and agencies to improve efficiencies.

“We want a more efficient structure so that decisions can be implemented sooner. The current structure needs to be broken. We need to refresh and focus on restructuring by taking into account the inputs of stakeholders. We need a system that does not revolve around one person,” he said.

Central Bank Governor Dr. Nandalal Weerasinghe, who attended the AGM as the chief guest, highlighted that tourism is more vulnerable to shocks than any other industry.

He urged the sector to build financial buffers to cushion against disruptions such as those experienced in recent years.

“Build buffers without coming back to banks and asking for moratoriums or support from the government. This is not sustainable,” Dr. Weerasinghe said. (SAA)