How wheeler-dealing over visa could kill tourism’s golden goose

If the Government of Sri Lanka desires to streamline the inefficient and corruption-laden immigration and emigration authorities, one can’t find fault. 
The Immigration Department is infested with crooks that have fought against even the most innocuous measures of oversight and accountability. CCTV cameras purchased to install in its head-office are still stored in the warehouses for six years, the Parliamentary Committee on Public Accounts (CoP) found recently.

But, a controversial and unsolicited tender that awarded the monopoly of visa processing to a private contractor, VSF Global -- which overnight doubled the on-arrival visa fees, unleashed chaos and confusion at the airport, and risked the future of the tourism industry in the country--smack of a scam far extraordinary or grand incompetence, and most likely both. 

Consider the consequences. Before the controversial deal with VSF Global, Sri Lanka accorded visa-free facilities for tourists from 7 countries: India, China, Indonesia, Russia, Thailand, Malaysia, and Japan. 
With the private contractor taking over the visa processing, ‘free visa’ to Sri Lanka, overnight,  got a new interpretation. With VSF-Globals service free plus a convenience fee, visitors from core source destinations are now paying US$ 25.77 for their ‘free visa’. 

Highest visa fee 

At the same time, some facetious minds in the government thought to increase the 30-day - On arrival visa fee, priced at US$ 50 for visitors from other countries, by US$ 25. Strangely enough, the local tourism sector is heading for off-season. With the commission fee of US$ 25.77 by the private contractor added, these visas now cost US$ US$ 100.77.
That effectively makes Sri Lanka have the highest visa fee in Asia, a dubious achievement for haphazard policies. 
 A family of four travelling to Sri Lanka would now have to cough up US$ 400, making a visit unattractive. The visa fee for Sri Lanka’s peer competitors in the region, such as Singapore, Vietnam, and Cambodia, ranges from US$ 20 to US$  40.  

According to the industry stakeholders, the deal with VSF Global has not only made visas expensive but also made getting one difficult.  
A previous user-friendly platform used by the Department of Immigration has been relegated overnight and replaced by a complex system with an OTP system, scrolling sections that are not easy to find, requirements of documents, complex format requirements for documents, unnecessary required fields,” industry stakeholders have written to the president.

Tourism targets

Self-inflicted calamity in the tourism sector would fail Sri Lanka in achieving its target of 2.3 million tourists this year. Writing is already on the wall. The tourist arrival fell short of the 200,000 mark for the first time this year. The tourist arrival in April was 148, 867, a significant drop from 209,181 the previous month, though it represents a 41 per cent increase from the previous year. 
 While the factors contributing to the drop may be seasonal, as the tourism sector is heading for the off-season, industry stakeholders have observed expensive visas and complex and confusing processes having 
aggravating factors.

Government forfeits right to issue free visa? 

After the public outcry and industry concerns, the Cabinet has decided to revise visa fees back to the original US$ 50. However, how that would be achieved is open to question, considering that any government visa fee would be added with US$ 25.77 charges by the private contractor. That would make the cost of a 30-day on-arrival visa US$ 75.77 unless, of course, the government forfeit a portion of its visa fee to compensate the fee levied by the VSF-global.
The free visa for visitors from seven nations would no longer be ‘free’ but would come with the US$ 25.77 levy charge by the private contractor.

Who is the Winner of the deal?

Who benefitted from this crooked deal is not that difficult to discern.
VSF Global is surely the Winner. At a targeted 2.3 million tourists in 2024, the private contractor would make  US$ 42 million or 12.7 billion rupees on the 18.5 dollar fee alone.
What Sri Lanka achieved, other than engulfing the entire tourism sector in confusion, bewilderment and allegations of reeking corruption, is unclear. 
For an industry that matters certainty and connivance, the latest controversial deal has delivered the worst blow since Covid and the Easter Sunday attack.  
Mitigating the decision’s fallout seems hampered by the intricate vested political interest.

Is this grand corruption?

Grand corruption is a high-level act of abuse of power at the heights of the state for the benefit of a few at the expense of the many. They create lasting and extensive harm and deprivation for most of the public. Grand corruption distorts state policy to the advantage of a few, often well-connected individuals. It diverts state resources, revenue avenues, and tenders through unscrupulous and uncontested means to unscrupulous individuals at the expense of the majority population.  
Grand corruption differs from petty corruption of the involvement of high level political leaders and bureaucracy and the vast amount of state resources at stake and their long-lasting adverse impact.  

In contrast, corrupt immigration authorities taking a bribe from a visitor is petty corruption. Grand corruption involves ill-gotten gains at a substantial cost to the public. 
Consider how the VSF-Global deal was signed. The private contractor sent an unsolicited tender to the Sri Lankan authorities, and the Cabinet approved it and passed it to Parliament without a debate. 

At that time, the VSF-global’s charges were not disclosed to the Cabinet or Parliament.
Unsolicited tenders are a key vehicle of corruption in Sri Lanka, which the IMF has identified as a key enabler of corruption in the country. 
Public Security Minister Tiran Alles,   under the purview of the Department of Immigration and Emigration, has defended the granting of unsolicited tender to VSF --global. He insists the deal with the private contractor would last 12 years. 

“VFS sent us a proposal, which we studied and submitted to the Cabinet. I don’t believe any company could compete against a company like VFS Global,” he told a press conference. 
This is not how high-end state transactions are conducted-- at the whims and fancies of a few questionable individuals. 

Consider how much VSF Global is about to make in its ‘12 years’ in Sri Lanka. Even at the current target of a minimum of 2.3 million visitors, its annual earnings come to 12 billion rupees a year. As tourist arrivals are bound to increase, unless the government squanders it by its own vocation, one might count a minimum of 5 million visitors on average for the next ten years, which would still be on the lower order of estimates. The VSF global would make a minimum of 250 billion rupees during its prescribed 12 years, which is also the lower order of estimates.   
It is naïve to expect such unsolicited tenders to be granted without greasing the palm. 
Allegations of bribery are already reverberating. Harsha de Silva has queried a 200 million dollar investment claim made by a private contractor which has been used to justify high fees charged from tourists for entry visas.
There are allegations of a US$ 10 million campaign contribution to President Ranil Wickremesinghe.

As much as such allegations cannot be verified, the Sri Lankan political system and its key players are highly compromised. Internal mechanisms to investigate corruption are weak and infested with political inference.
As things stand, Sri Lanka is a net loser of the deal with the private contractor. Some of the government ministers are probably not.