COLOMBO: A political crisis in Sri Lanka, where two prime ministers are fighting for power, is scaring away tourists and raising questions over foreign aid, ringing alarm bells for the economy as the currency slumps to record lows.
The turmoil in the Indian Ocean nation that has seen one premier refuse to be sacked and another battle to prove majority in parliament that is banned from meeting, has caused major upheaval that Sri Lanka cannot afford.
Amidst warnings from politicians of a “bloodbath” if the dispute escalates, tourists are cancelling hotel bookings just as Sri Lankan beaches and major sites like the Temple of the Tooth prepare for peak season.
While no official figures have been given, deluxe hotels have reported cancellations and a critical decline in new bookings in the past 10 days. “This comes at the worst possible time when people in Europe are making their holiday plans abroad,” a Colombo city hotel executive told AFP. “We have had a lot of cancellations from the United States.”
“With the political crisis, our winter season is gone,” the director of a luxury beach resort in the south of the island said. Western nations have warned their citizens to be on guard in Sri Lanka.
“You should exercise vigilance and avoid all demonstrations or large political gatherings,” a British government advisory said.
Tourism is a cornerstone of the economy. More than 2.4 million foreign holidaymakers visited last year, spending $3.2 billion. Authorities had been counting on a rise of more than 10% this year.
And whether Ranil Wickremesinghe stays in office or former president Mahinda Rajapakse takes his place, foreign earnings will be badly needed.
Published in The Express Tribune, November 6th, 2018.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ