Tourism industry can’t pay back loans

Tourists have not been visiting Sri Lanka since March this year and the tourism industry that is surviving on loans now want the government to assist them by extending the payback period by two years.

With the moratorium on the loans provided post pandemic due to end in September, the tourism industry wants more state assistance to extend this period for another two years.

Tourist Hotels Association of Sri Lanka (THASL) President Sanath Ukwatte told the Business Times that after the general election the industry hopes the government will look into the extension on the moratorium granted on loans given this year due to the pandemic by another two years.

However, he insisted that the government is very clear on their tourism strategy and has given due recognition for tourism with export status. He also pointed out that the government has appointed a favourable team tasked with running the industry.

Moreover, Mr. Ukwatte pointed out that the sector obtained the required boost with topline factors like the Nation Building Tax (NBT) and the Value Added Tax (VAT) had been removed.

The industry has still not obtained loans to pay salaries of staff as there has been a delay in the disbursement of the monies, it was noted.

The 6- month salary loan will allow businesses in the tourism industry to pay loans of workers at the rate of Rs.20,000 as some are said to be at home.

He noted that the industry is trying to retain their staff but their first priority is to ensure that companies survive in order to provide employment for people. “Companies must survive for employees to come to work.”

More staff cuts are possible, Mr. Ukwatte said and the last to come will be the first to go as most of the staff is still at home.

Sri Lanka Association of Inbound Tour Operators President Mahen Kariyawasam explained that they too hope to request for the necessary extension on the moratorium on loans provided to them post COVID-19.

He also pointed out that the delay in the loan given for wage payment is particularly due to the fact that the Central Bank has not advised the Bank of Ceylon to release the funds for this particular loan.

Moreover, Mr. Ukwatte pointed out that the sector obtained the required boost with topline factors like the Nation Building Tax (NBT) and the Value Added Tax (VAT) had been removed.

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