Speaking at a Public Utilities Commission of Sri Lanka consultation on electricity tariffs, Hettigoda said the industry is already grappling with high operational expenses, which could make the country less competitive compared to regional rivals such as Malaysia, Thailand, and Indonesia. “Our competitors benefit from lower electricity tariffs, government incentives, and promotional campaigns. Maintaining competitiveness is vital if Sri Lanka hopes to attract high-spending tourists,” he said.
Hettigoda highlighted that although tourist arrivals have surged following last year’s Cyclone Ditwah, revenue remains around 30 percent below 2018 levels, translating to an estimated shortfall of USD 700 million in 2025. External factors such as trade barriers, export tariffs, and the ongoing crisis in the Middle East—particularly affecting tea exports—have increased the nation’s dependence on tourism as an economic driver, a point echoed by international institutions like the IMF and World Bank.
The Middle East crisis in late February has already disrupted over 30 percent of tourist arrivals, especially from Europe, resulting in estimated monthly losses of USD 60–70 million. Hettigoda warned that cancellations and limited flight availability could continue affecting European visitors—the sector’s highest spenders—for at least the next six months.
Operational costs have also surged sharply. Salaries increased by 50 percent from 2025 to 2026, and spikes in fuel, gas, food, and laundry expenses have further strained hotels. Hettigoda stressed that any increase in electricity tariffs would compound these challenges, forcing hotels to raise room rates and eroding Sri Lanka’s appeal to international travelers.
“Tourism is not just a revenue generator—it is a key pillar of economic stability. Protecting it from rising costs is essential if Sri Lanka is to remain competitive in a crowded regional market,” he said.
Hettigoda urged policymakers to maintain current electricity tariff levels and consider broader measures to support the tourism industry, ensuring it continues to contribute significantly to national GDP while navigating global and regional uncertainties.
