Sri Lanka Tourism running out of cash
Acommission amounting to US$1.6 million had been remitted to a dollar account of the Sri Lanka Tourism Development Authority (SLTDA) via insurance payments made by tourists via People’s Insurance PLC; but today, authorities claim there is no money in their kitty to pay for travel fairs.
During the COVID-19 pandemic when the country opened up for travellers, the SLTDA brought about regulations to ensure all tourists obtain an insurance cover when arriving in the country in a bid to ease the burden of the Sri Lankan healthcare sector.
As a result, all international travellers arriving in Sri Lanka are charged a sum of $12, for a 30-day cover, where People’s Insurance PLC received $8.50 as the insurance premium and the SLTDA received $3.50 as the facilitation (commission) fee, a statement issued by the company’s CEO stated.
In the light of this revelation it is learnt that with 479,829 visitors entering the country up to March 31, 2022 from whom this charge is being made then the total amount obtained is $5,757,948. The SLTDA would then receive its facility fee at the rate of $3.50 that would amount to a total of $1,679,401, industry officials said.
But what is surprising is that if this amount had been received by the SLTDA to a dollar account maintained by them, then should this not have been used to pay for the Arabian Travel Mart (ATM) and SATTE in India travel fairs, they asked.
Conversely, the authorities have registered participation at the ATM event under a credit facility obtained from the organisers insisting they are unable to make any payments as of now.
Moreover, the SLTDA had been unable to find suitable funds through their dollar account because they allege that there was insufficient monies available.
A statement issued by the People’s Insurance PLC states that following a tender process the said company had received the invitation to bid for the tender from the SLTDA on December 2, 2020 and had successfully won the bid. The tender was awarded on January 7, 2021 and the policy became active on January 21, 2021, it was stated.
Travellers, at their discretion, may extend the cover for a longer period at an additional premium, depending on the duration of their stay.
The People’s Insurance PLC is a subsidiary of People’s Leasing and Finance PLC which is a part of the People’s Bank Group.
In a media release issued soon after the signing of the agreement with the SLTDA, People’s Insurance stated that the policy covered hospitalisation, quarantine hotel charges and expenses for procedures which will prevent the spread of COVID-19 if the individual becomes infected with COVID19 or becomes a close contact of an infected patient during their stay in Sri Lanka. As an added safety blanket, this insurance cover from People’s Insurance is supported by strong reinsurers from the Lloyds reinsurance market.
At the ATM fair in Dubai from May 9-12 a stall of about 150 sq. m. had been obtained on credit that amounts to approximately $130,000 for
which construction of it and space area were obtained on a credit facility.
The SLTDA in an unsigned document with the Sri Lanka Tourism logo dated May 9 2022, reacting to recent statements made on social media stated that these (insurance) monies obtained as commission amounting to $3.50 “has been duly accounted and is being used for administration, promotion and staff welfare”.
However, it is unclear why the SLTDA had to channel funds from this dollar account when usually the Treasury makes annual allocations for administration and staff welfare in the annual budget.
It is learnt, that the authorities had requested the Sri Lankan Embassy to represent the country at the ATM and monies had already been remitted in rupees to the Sri Lankan Foreign Ministry in this regard.
India too had agreed to allow Sri Lanka Tourism to establish a stall space of 250 sq. m. at the SATTE Indian travel fair scheduled from May 18-20 on a credit facility at the fair where about 65 local companies will be participating. The credit period for repayment is till the end of this year, it was revealed.
Further it was found that the authorities faced a similar crisis at the November 2021 World Travel Mart in London. Then, Sri Lanka was given a credit period of about three months for which approximately UK Pounds 40,000 had to be paid in three to four installments.
Meanwhile, it is learnt that despite not being reappointed the Tourism Ministry Secretary S. Hettiarachchi continues to function in his capacity and has held meetings this week with the tourism industry as well.