Sri Lanka: Relief Package To Strengthen The Tourism Industry

Both the debt moratorium and the working capital proposed by the Ministry of Finance as a ‘Relief Package’ to strengthen Sri Lanka’s tourism industry affected by the Easter Sunday Attacks is now finally falling in to place, said S. Shanthikumara, President Colombo City Hotels Association. He said that the two state banks, Bank of Ceylon and Peoples Bank have agreed to differ the loans taken before April 21 for a period of one year including interest.

Capital and interest falling due during the moratorium period would be converted into a term loan which should be recovered from July 2020 and charged at a concessionary rate. In addition the two State banks have also agreed to offer fresh working capital with a repayment period of 2 years with a 75% interest subsidy borne by the government from the effective interest rate until March 31, 2020.

“In both these scheme the hotels have only got to the paper work to obtain them and we are thankful to the government for coming up with this timely scheme.” However he said that the private banks are yet to agree to this scheme. Shanthikumar also said that the staff loan scheme is yet to take off as both State and private banks are yet to response positively for requests made in this regard.

Meanwhile, commenting on the City Hotel room rates he said that they have come down by around 30 to 40% and and did not expect to see them increase soon.

“Usually during this period Colombo City hotels maintains around 65% occupancy but now this is at around 10%.” He said that most of the MICE events that were planned to be held during the next two months to have been rescheduled while some are on hold.