In a bid to attract more private sector investments and bolster the tourism industry’s growth, Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando has announced significant advancements in the streamlined approval process for tourism investment projects.
Through the establishment of the Investor Relations Unit (IRU) in October 2010, the SLTDA has been working diligently to facilitate tourism investments from the private sector.
“We are committed to creating a conducive environment for tourism investments in Sri Lanka. The Investor Relations Unit plays a crucial role in streamlining the approval process and providing the necessary support to potential investors,” stated Chairman Fernando.
The IRU has achieved several milestones over the years, enhancing the investment approval process for tourism projects and engaging in fruitful collaborations with key State agencies. Among the key achievements are the introduction of a common application form in consultation with all project approving Ministries, Departments, and Agencies (MDAs), which is currently in use. Additionally, an Investor Handbook has been prepared, providing investors with accurate information on the approval process.
To ensure a cohesive approach, Memoranda of Understanding (MoUs) were signed with 10 key Government agencies, including the Board of Investment (BOI), Urban Development Authority (UDA), and Coast Conservation Department, among others.
These MoUs solidify commitments to accept a common application as the document for project approvals, assign contact persons for streamlined processes, set specific timeframes for approvals, and integrate automated systems when ready.
To streamline communication and coordination further, contact officers have been nominated by all key Government agencies, both at head offices and regional levels, for efficient IRU processing. Written timelines for approvals have been received from all agencies, ensuring transparency and accountability.
Moreover, extensive training programmes have been conducted for regional-level nominated officers of key Government agencies, Divisional Secretariats, and local authorities, imparting knowledge about the streamlined process.
Efficient approval process
The streamlined approval process consists of three steps:
Step 1: Preliminary clearance of SLTDA – Involving application evaluation, site inspection, and a scoping committee meeting, this step takes 18 working days
Step 2: Pre-development permit process – For projects without Initial Environmental Examination/Environmental Impact Assessment (IEE/EIA) processes, this step takes 14 working days and includes approvals and clearances from MDAs
Step 3: Development permit/final approval of SLTDA – This step takes 17 days
For projects requiring IEE/EIA processes, additional working days are necessary:
- For projects where IEEs are required – 31 working days + 31 working days for administrative procedures + time for report preparation by the investor
- For projects where EIAs are required – 114 working days for administrative procedures with public comments + time for report preparation by the investor
Automation and investment promotions
Looking ahead, the SLTDA is working on automating the integrated streamlined approval process for tourism investments, further simplifying and expediting the procedure.
In addition to the facilitation services provided by the IRU, Sri Lanka is actively engaging in investment promotions for the tourism sector. Chairman Fernando revealed: “We have recently initiated the process of attracting Foreign Direct Investment (FDI) to the sector. An investment forum is planned for Q2 or Q3 in 2024 and initial preparations and discussions are already underway.”
According to the SLTDA, the strides made by the Investor Relations Unit and the SLTDA’s commitment to promoting private sector participation in the tourism industry signal a promising future for Sri Lanka’s tourism landscape.
According to the SLTDA, as the country continues to rebound from the impact of the Covid-19 pandemic, these efforts are poised to unlock the industry’s full potential and drive sustainable growth for the nation.
The streamlined approval process, complete with a common application form, clear timelines, and collaborative efforts with key Government agencies, is a significant step towards creating an investor-friendly climate in the country.
“By providing investors with an Investor Handbook and design guidelines, the SLTDA demonstrates its commitment to supporting potential investors throughout their journey,” Fernando added.
He further emphasised: “We have left no stone unturned in our quest to make the process more efficient and accessible. Our dedication to streamlining the approval mechanism reflects our determination to welcome more investments and foster economic growth in the tourism sector.”
According to Fernando, as Sri Lanka positions itself as a top-notch tourism destination, it is the concerted actions that will pave the way for success. With an efficient and transparent approval process, the country showcases its readiness to embrace tourism investments that will drive job creation, infrastructure development, and overall economic prosperity.
With the IRU taking the lead in facilitating investments, the country sets an example for others to follow, sending a clear message to the global business community that Sri Lanka is open for business and ready to create a thriving and sustainable tourism industry.
According to Fernando, the upcoming investment forum promises to be a significant milestone, providing a platform for local and international investors to explore the plethora of opportunities awaiting them in Sri Lanka’s vibrant and diverse tourism sector.
Attracting foreign investment
Meanwhile, according to Board of Investment (BOI) Director General Renuka Weerakoon, the country is effectively attracting sufficient investments in the tourism sector, while there is also a need for more concerted efforts to bolster tourist arrivals.
She confirmed a notable upsurge in tourism investments.
“We have an upsurge in tourism investments. We have a lot of investors coming in for the hotel sector,” she said. This influx of investors signifies a growing interest in Sri Lanka’s vast tourism potential.
The focus of these investments was revealed to be primarily centred around the hotel industry. Both upgrades of existing establishments and the construction of new hotels have garnered significant attention from investors.
She elaborated: “Activity-wise, it’s really the tourism and the hotel industry that have seen the upsurge. There are a lot of new projects and upgrades happening.” This indicates that investors are keen on capitalising on Sri Lanka’s thriving tourism industry.
The numbers
The hotel sector plays a pivotal role in Sri Lanka’s tourism landscape, offering accommodations and amenities to domestic and international visitors alike.
The country’s tourism sector continues to bounce back as July recorded the highest monthly arrivals of tourists this year with a total of 143,039, according to figures published by the SLTDA.
In July 2022, when the country was grappling with the peak of the economic crisis, the number of tourist arrivals in July had dipped to 47,293.
Official figures showed that tourist arrivals in July 2023 have recorded an increase of 202.4% in comparison to July 2022.
The cumulative figure of tourist arrivals for the first seven months of 2023 (January-July) thus climbed to 767,913, while the entirety of 2022 recorded only 719,978.
According to the SLTDA, the top 10 source markets for Sri Lanka’s tourism in July were India, the UK, China, Germany, Russia, France, the Netherlands, the Maldives, Canada, and Australia, respectively.
Tourism is a crucial component of Sri Lanka’s economy, contributing significantly to its GDP and creating employment opportunities for the local population. As the country seeks to rebound from the economic impact of the Covid-19 pandemic and the economic crisis, attracting more tourism investments becomes a key priority to reignite growth in the tourism sector.
