Sri Lanka hotel earnings growth seen subdued

July 14, 2009 (LBO) – Sri Lanka expects more tourists this winter season with heightened interest in the destination after the war ended but hotel earnings are not likely to improve immediately, officials and analysts said.

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“We can’t definitely see a concrete increase in numbers right now but certainly there’s improved sentiment,” Tourist Hotels Association of Sri Lanka president Srilal Miththapala said.

“We’re getting good inquiries – people already working with us wanting to increase allotments of rooms, mainly in resorts; and people who are not, wanting to see how they can restart operations.”

The improved interest, that came soon after government forces ended the Tamil Tiger insurgency in May, augurs well for the future, he said.

“Previously we had to go looking for buyers but now that’s changed and the buyers themselves are calling us. It’s a sign things are changing.”

Trade officials said overseas travel operators were trying to sign up early for holiday packages, worried that the island’s hotels might raise prices later.

Sri Lanka is known as a cheap destination as the industry has been forced to cut prices to draw customers because the ethnic war had deterred visitors for years.

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