Deluge of cancellations and Shangri-La shutdown follows Sri Lanka bomb attacks

Six bomb attacks on Easter Sunday may have destroyed a meticulously crafted and industriously engineered decade-long recovery of Sri Lanka’s economy that is largely dependent on the currently thriving tourism industry. The heinous attacks perpetrated by terrorist suicide bombers on unsuspecting worshippers and holiday revellers over the Easter weekend left more than 359 dead and a few hundred injured at churches in Colombo, Negombo and Batticaloa and three deluxe five-star hotels in the capital of the emerald isle. The country has announced a curfew on movements in Colombo, bringing normal movement in the city to a virtual standstill and the departure of tourists from the country.

Around 40 international tourists are reported to have been victims of the explosive attacks. Consequently, the hotels and inbound DMCs have been deluged with cancellations ahead of the prime summer tourist season. The Shangri-La Hotel in Colombo has announced an indefinite shutdown while the Cinnamon Grand Hotel and the Kingsbury Hotel are reeling from shock. Sri Lankan Airlines is facing major cancellations of FIT passengers from its prime source markets such as India, China, Australia as well as Europe and south-east Asia.

In his first reaction to Sunday’s blasts, Prime Minister Ranil Wickremesinghe said tourism industry will be hit by the blasts. “There will be a downward trend, tourism will get affected. There may be fund outflows,” Wickremesinghe said. Industry officials said the rebound from the attacks would depend on the security measures to be adopted and gaps to be plugged.

The big hotels which were not affected by the blasts such as the Galle Face Hotel, Ramada and Taj Samudra were seen taking additional security measures. They have erected barricades and are using hand scanners for guests entering. These measures will bring back memories of the times of the heightened military clashes with the LTTE. For 10 years the island nation has experienced peace with relaxed security. Mount Lavinia Hotel south of the capital, a popular site for the tourists, said there have been a large number of cancellations. Chandra Mohotti of Galle Face Hotel said “there will be huge cancellations”.

Lalith Peiris, regional manager East India of Sri Lankan Airlines, said: “We have not seen any incentive group cancellations yet as most of them are travelling in June and July and there is time for them to assess the situation. The impact is sudden and the danger unanticipated, as after the war, Sri Lanka was a very peaceful country and we did not install too many security controls. Today, an Indian incentive group of 50 left for Bentota for three nights, clearly undeterred, which assures us of customer loyalty and affinity for our country. Now security measures will be in place as in many other destinations where similar violence has taken place. It is sad but we will lose some freedom of movement and our relaxed lifestyle.”

Kishu Gomes, chairman of the Sri Lanka Tourism Development Authority, said that it was still too early to predict the impact of the attacks on the services sector.

According to data from the World Travel and Tourism Council, tourism and services activity account for 12.5 per cent of the gross domestic product of Sri Lanka with a population of a little over 20 million, and provides employment to more than 1 million people. India is the largest source market for Sri Lanka, which received 2.3 million tourists from around the world in 2018. Around 397,985 Indian tourists visited Sri Lanka in 2018 and the island nation was expecting the total Indian tourist arrivals to cross one million mark in 2019. Tourism revenues in Sri Lanka increased to US$362 million in November from US$284 million in October.

Chandra Wickramasinghe, chairman of Connaissance de Ceylan, a large inbound DMC based in Colombo said: “The test will be to see if we get the same growth in numbers from Europe in the July-August holiday season and the continuity of Indian and Chinese visitors, our largest inbound segments.”

“Sri Lanka has been a popular choice amongst Indian travellers seeking a quick international getaway, especially during long weekends. Following the attacks, we have seen a 17 per cent dip in enquiring customers for the country. We anticipate current unrest in the region will lead to a temporary slowdown in tourist inflow to Sri Lanka,” Aloke Bajpai, ceo and co-founder, ixigo said.