Tourist arrivals to Sri Lanka during the months to September rose 13.6 percent year-on-year (yoy) to 121,576 visitors and total arrivals for the first 10 months of the year was 1.22million, up 21.5 percent yoy. Sri Lanka targets 1.5 million tourists at the end of this year and 2.5 million by 2016.Tourist arrivals in October were boosted by higher number of visitors mainly from South and East Asia. The East Asian arrivals recorded a 54.4 percent yoy increase during October, led by Chinese tourists. Arrivals from China, which includes mainland China, Hong Kong and Macau rose 120.7 percent yoy to 11,894.China is the third largest tourist market for Sri Lanka country-wise. Total Chinese arrivals in 2014 rose 139 percent yoy to 106.888 during the first 10 months of 2014.Arrivals from Japan, which is among the top 10 tourism source markets, rose 13.2 percent yoy to 2,874 while Malaysian arrivals rose 46 percent yoy to 1,822.South Asian arrivals in October rose 10.7 percent yoy to 35,718 led by Indian arrivals which rose 19.8 percent yoy to 26,148.India is leading among the top 10 tourism source markets for Sri Lanka. During the first 10 months of 2014, arrivals from India rose 18.3 percent yoy to 196,819.Arrivals from Maldives decreased by a marginal 0.4 percent yoy to 6,460. Visitors from Pakistan fell 33 percent yoy to 1,725.Arrivals from Western Europe, Sri Lanka’s largest tourism market as a region, rose 10.1percent yoy to 32,061. Arrivals from UK, Sri Lanka’s second biggest market country-wise, improved 2.7 percent yoy to 10,112 with arrivals from Germany, the fourth largest market increasing 23.8 percent yoy to 7,966.
Meanwhile, visitors from Eastern Europe in October, Sri Lanka fourth largest market as a region, fell 10.3 percent yoy 11,365 with arrivals from Ukraine dipping 52.4 percent yoy to 4,584.Political unrest in Ukraine is likely to have caused this decline. In September too, arrivals from Ukraine fell almost 47 percent. Tourist arrivals from Russia, the seventh largest market country-wise saw a modest 4 percent yoy increase to 5,302. Arrivals from Middle East, the fifth largest tourist market for Sri Lanka region-wise, saw only 0.6 percent increase with visitors from Saudi Arabian increasing by just 0.4 percent yoy to 2,652.Arrivals from UAE fell 10.4 percent yoy to 968 while arrivals from Israel rose 129 percent yoy to 689.Visitors from Australasia rose 14.7 percent yoy to 4,312 with arrivals from Australia improving 14.6 percent yoy to 3,794. Tourist arrivals from New Zealand also increased 30.6 percent yoy to 487.Sri Lanka Tourism follows the UN standard of defining a tourist as ‘’ a person who stays at least one night in a country and does not exceed his stay period for more than 12 months’’. However, despite the higher tourist arrivals, the five-star city hotels appear to be losing business big time due to a significant growth in the so-called informal sector.
A lot of tourists coming into the country seem to be taking accommodation in resorts and hotels with lower room rates compared to 5-star city hotels. Meanwhile a number of apartments, lodges etc have opened in Colombo and elsewhere to benefit from the increased tourist arrivals, which are also considered relatively cheaper options. According to Institute of Policy Studies (IPS) research, close to 11,700 rooms are available in the informal sector compared to 15,000 in the formal sector at the beginning of this year. For the quarter ending September 30, 2014 (2015) the net profit of the company fell 23 percent year-on year (yoy) to Rs 437.8 million. Earnings per share deteriorated from Rs 1.28 to Rs 0.99 yoy.