Working capital and skilled labour issues plague tourism sector

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Sri Lanka’s tourism industry is now experiencing severe working capital and skilled labour shortages, Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando told Finance Today.

He said it has turned into a significant barrier to getting the nation ready for the upcoming December winter season.

“We are now busy preparing the tourist sector for the December season”, he said, but claimed that a significant barrier is the absence of working capital and skilled employees.

According to reports, a shortage of seats exists while distributing airplane tickets to Sri Lanka. He said necessary conversations were taking place to find answers to this problem.

In light of the nation’s economic problems, SLTDA chairman indicated that plans have been developed to draw travellers who can stay for longer periods, around three to four months.

He said for these individuals, travelling to Sri Lanka to spend their winter is less expensive compared to other destinations.

The World Travel Market in London, which runs from November 7 to November 9, will feature promotional activities in this regard, according to the Tourism Promotion Bureau’s plans.

According to reports, the accumulated debt in the tourism sector has now risen to 600 billion rupees.

He also said people working in the tourist industry on a small and medium scale were suffering severe financial challenges.

The tourist sector debt moratorium is set to expire on December 31. However, it is reported that several alternative proposals regarding the procedures to be adopted in respect of the debts have been received and the relevant matters were being reviewed.

It is also said that attempts have been taken to initiate a programme to enhance the industry’s working capital requirements through alternate capital raising strategies.

According to the agreement that will be reached with the International Monetary Fund (IMF) in the near future, negotiations are also taking place about the prospect of restructuring associated tourist debt in collaboration with the Asian Development Bank (ADB).

SLTDA chairman said for discussions with the ADB to be successful, Sri Lanka must obtain approval of the IMF’s Executive Board for staff level agreement that Sri Lanka recently signed with the IMF.

According to the current circumstances, short – term training courses are expected to provide solutions to the shortage of a trained workforce.

He further said due to the industry’s collapse, the majority of trained personnel in the tourist sector had gone for overseas jobs.

However, it is said that a programme has been begun to enhance tourism infrastructure targeting certain sites, like the Kalpitiya beach to prepare for the forthcoming tourist season. Badulla and Nuwara -Eliya are also in the list.

This year, Sri Lanka anticipates at least one million visitors.550,000 visitors visited Sri Lanka in the first eight months of this year, and another 450,000 are anticipated in the following three-and-a half months. Tourism has brought in nearly 900 million dollars so far this year. The 1.6 billion dollar goal for tourism earnings this year is anticipated as a result.

By Ishara Gamage