Reviving tourism SME sector, critical for economy, states Travel Expert


Sri Lanka Tourism should pay greater attention to supporting the Small and Medium Enterprises (SMEs) tourism sector which accounts for a major share of employment currently in jeopardy for the past two years, said social scientist and tourism expert, Dr. Dietmar Doering.

He said Europe continues to be the largest source of tourist traffic to Sri Lanka recording a share of 55.4 per cent while Asia Pacific is the second major source market with a share of 35.7 per cent.

Registered accommodation establishments show 156 classified tourist hotels including one-to-five-star hotels and boutique hotels, villas or bungalows, representing 887 establishments in this sector, and 1099 guesthouses, 725 home stay units together with hostels, rented apartments and unclassified tourist hotels totaling 2164 establishments.

Statistics show that 71% of Sri Lanka’s Tourist Accommodation lies within the small and medium sector while 29% represents the established more high-end oriented spectrum.

“Proven analysis into the specifics of tourist traffic reveals that the major market from Europe with its 55.4% shares preferred accommodation within guesthouses, home stays, rented apartments and unclassified tourist hotels,” Dr. Doering said.

Second, the biggest part of the FDI segment lies within the un-organized tourism sector under which most of the SME Enterprises fall. In India for example over 50 per cent of the total GDP generated by the unorganised sector, which are small and medium businesses with millions of street vendors playing a major part in it.

In Sri Lanka’s tourism industry its similar when we look at the thousands of private vehicles, chauffeurs, using their privately owned transports, the vendors at the tourist attractions or the thousands of home stays and residences offered in the major digital marketing platforms, Agoda, Trip Advisor who are counting for million of daily visitors in their websites. The majority of these establishments are not registered with the SLTDA and therefore, the SLTDA stats are incomplete.

“Empowering the private tourist sector with a more lenient line of restrictions towards the SM tourist enterprises is at the end of the day the recommended way of directly generating valuable foreign currencies into the Sri Lanka economy,” Dr. Doering noted.

He added that the high-end SL tourists establishments – often linked to international chains or conglomerates located outside of Sri Lanka – in some cases siphoning, the much needed foreign funds needed for Sri Lanka to their respective head offices abroad.

It is the need of the hour to plan and implement a strong support for the SM Tourist enterprises in Sri Lanka. Also, especially in view, that these mostly family-managed tourists have ways to act much faster than their much bigger counterparts.