Hotels’ Association Chief opposes price reductions to increase volume; calls for using more local products

By Harischandra Gunaratna

President of the Hotels Association of Sri Lanka (THASL) M. Shanthikumar on Monday said that the hoteliers had to abandon the practice of reducing prices to increase volume; they had to maintain prices at a reasonable level to cover costs, which were soaring, he added.

Shanthikumar, addressing top-notch hoteliers and invitees from allied fields at the 57th anniversary celebration of the association at the Colombo Hilton, stressed the need to generate more forex.

The THASL President said some hoteliers thought that imports accounted for 80 percent of the food and beverage costs, but in reality it was only 40%.All hotels should use indigenous products as much as possible and chefs and food and beverage, Shanthikumar said, adding that the hoteliers would be able to bring down the expenditure on imports to about 30 percent in the future.

The veteran hotelier hailed the tourism industry here for always being resilient.Shanthikumar admired the manner in which the hoteliers responded to the government’s call to run the industry efficiently, whilst saving much-needed foreign exchange for the country.

Shanthikumar reiterated the fact that the government should support the hospitality industry to come out of the current crisis.

THASL President said that some of the accommodation units were still under construction whilst some investors had already decided to close down their hotels due to the current economic turn down. He requested the government to give a clear indication of the total debt repayable including interest with a breakup of the actual liability of the operational hotels and urge the Central Bank of Sri Lanka to obtain information from the public and private sector banks.

“Our estimate of the overall tourism debt is approximately Rs. 500 billion including working capital loans of Enterprise Sri Lanka, Saubagya loans, term loans and accumulated interest due to moratoriums extended and I am happy to learn that some of those loans are being settled now.”