Sri Lanka in danger of pricing itself out of market

SRI Lanka, where hotel rates have more than doubled in the past three years, is in danger of pricing itself out of the convention and corporate travel market, travel industry officials say.

“Some of the rates for cultural sites are among the priciest in the world, while five-star hotel rates which were US$55 to US$80 in 2009 are now going at US$170,” said Chaminda Dias, executive director, Luxe Asia, adding that visits to all key cultural sites now cost an average US$60 from US$30 earlier.

Nilmin Nanayakkara, managing director of Nkar Travels & Tours, said in an interview with TTG Asia e-Daily earlier this year that his company “could have attracted more MICE tourism from Malaysia, Singapore and Thailand, if not for the rates”.

Rates have risen sharply since the ethnic conflict ended in May 2009 and tourism numbers have surged with a million expected this year, from 450,000 in 2009.

Hoteliers, however, disagree with the pricing issue.

“When we were at war (conflict), people said we were priced too low. Now they are saying we are priced too high,” said Hiran Cooray, chairman of Jetwing Hotels.

Anura Lokuhetty, deputy chairman/CEO of Serene Pavilions boutique hotel, said hoteliers, unlike tour operators, had made huge investments in the post-war era to upgrade services. “Even if rates have gone up at cultural sites, they are still cheaper than those overseas,” he said.

Rumy Jaufer, managing director of state-run Sri Lanka Tourism, said the country needed to pursue high-end corporate travellers instead of cheaper (segments).

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