Sri Lanka more hotels to satisfy demand

An industry report has said if Sri Lanka is to benefit from the burgeoning tourism industry, as many as 22,500 hotel rooms will be needed.

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Demand for Sri Lanka's tourism industry is currently outstripping supply.

With the end of the Sri Lankan Civil War in 2009, the country has begun to open up its border to tourists from across the world but without significant investment, the government's target of 2.5 million tourists a year is beyond reach, says a report published by IIFL Institutional Equities.

Sri Lanka enjoyed more than a 20% increase on tourism arrivals in June compared to the same period the previous year and an almost 19% increase in the Year to Date arrivals to June, almost 500,000.

However, to be in line with the government's targets, another 500,000 visitors are required by the end of 2012 and while the demand is clearly there, the report noted, the rooms to accommodate the visitors aren't.

“Given the growing interest in the hotel industry, we believe the sector is set for buoyant growth underpinned by increased tourist influx and capacity expansion. Until winter 2009, hotel occupancy levels were low; occupancy rates in city hotels averaged around 50% compared with 40% in resorts" read the report.

The 26-year-long Sri Lankan Civil War fought between the nation's military and the Tamil Tigers ended in May 2009 and since then, occupancy levels in the country's hotels and resorts have risen in line with peace time.

"Currently, occupancy levesl in city hotels have increase to an average 70% and occupancy levels in resorts have also increased to 65%."

The Worldwide Visa Bureau is an independent consulting company specialising in Sri Lankan visa and immigration information.