“They bombed our livelihoods”: Sri Lankan tourism companies fight after attacks

UNWATUNA / GALLE, Sri Lanka (Reuters) – Pearl Divers, a diving school located on one of the most popular beaches in southern Sri Lanka, closed for two months after suicide bombers attacked churches and hotels on the island on Easter Sunday, killing around 250 people. He didn’t have any clients because tourists canceled vacations, and his manager Nuwan Harshana said he took two months off and a cut in pay.

An empty beach is seen near the Unawatuna Beach hotels in Galle, Sri Lanka on July 4, 2019. Photo taken on July 4, 2019. REUTERS / Dinuka Liyanawatte

Last week, he dusted off the snorkel gear and boats, used to transport snorkelers off Unawatuna Beach, in hopes that foreigners will start pouring into the country again and the store can slowly get back to $ 800 a day in income she made before the attacks.

But there is no sign of a rapid recovery in his fortune.

“Everything was fine before April. Now that this situation is over … there are no more customers, ”said Harshana, who said he feared earning enough to care for his wife and two children, while respecting his monthly loan payments.

The economy of Sri Lanka, a sun-drenched island in the Indian Ocean, relies heavily on the $ 4.4 billion tourism industry. Small businesses like Pearl Divers have been on the rise since the country’s civil war ended in 2009, and tourists are pouring in.

But after the April attacks, tourist arrivals fell 70% in May and 57% in June from the previous year. Many small businesses, which employ thousands of people, are now either forced to lay off staff or have them work for minimum wage.

This is already having a domino effect on the economy, further affecting consumer demand.

The government has introduced a series of measures to boost tourism, including lowering airport charges, reducing taxes on jet fuel and encouraging hotels to offer discounts. It plans to relax visa rules for residents of a number of countries.

He also called on banks to lower lending rates and grant moratoriums on lending. But relief has yet to reach many of the small businesses that are the backbone of the economy.

“Obviously, it took a little while for the banks to prepare for it… because they had to work out the decision-making process,” Central Bank Governor Indrajit Coomaraswamy said Thursday.

Dilum Ranjana, who owns a foot spa in the southern fortified town of Galle, said he had to lay off three of the seven employees and postpone plans to open a second branch because he did not ‘had virtually no income in the past two months.

“It’s not easy to get a loan, there is a lot of paperwork and bureaucracy,” said Ranjana, who has monthly expenses of $ 2,300 on rent, bills and salaries. He said he had so far earned $ 570 in July, a tenth of what he did last year.

“All my plans are lost, they are ruined,” he said.


Tourism was the third-fastest growing and third-largest source of foreign exchange for Sri Lanka last year, and accounted for 4.9% of the country’s gross domestic product (GDP) in 2018.

The government expects a shortfall of $ 800 million to $ 900 million in tourism revenue this year, which will increase its current account deficit to 3% of GDP, from 2.3% previously, a senior central bank official.

The central bank also cut its growth forecast for the year to 3% from 4% earlier.

“The main concern is the increase in non-performing loans due to sluggish economic growth after the attacks,” the official said.

When the diving business was booming, Harshana said he took out a loan of $ 57,000 in 2017 to convert an old house into a no-frills hostel, earning him $ 114 a night from tourists in high season. It is currently closed because it has no reservations.

After letting him postpone loan payments of $ 630 for May and June, the bank is not making any such concessions for July, he said.

“I have to make do with my savings but I don’t have much. People like us, we rise slowly but the fall is sudden, ”he said.


The island received 2.5 million foreign tourists last year and with Lonely Planet magazine endorsing it as the top destination of 2019, the government was hoping to attract more than 3 million this year.

It now hopes to attract around 2 million tourists, said Johanne Jayaratne, chair of the Sri Lanka Tourism Development Authority.

Airlines canceled 41 weekly flights after the attacks and while carriers like Emirates have resumed their schedules, China Eastern, for example, still operates just four flights a week, half of what it used to be.

GW Ramyasiri, a 57-year-old fisherman who poses for tourists as he leans on a pole in Lake Kogalla near Galle, says the government is not providing enough help.

He says that before the attacks he earned up to $ 20 in tips every day from tourists, now he barely earns a dollar.

He said he sold the family gold and may not be able to send his youngest daughter to college.

“We need money, not loans. If the tourists don’t come back, how will I repay the loan? Ramyasiri asked. “They bombed us and our livelihoods. “

($ 1 = 175 4500 Sri Lankan rupees)

Additional reporting by Ranga Sirilal in Colombo; Editing by Martin Howell and Raju Gopalakrishnan

Comments are closed.