Sri Lankan tourism hit post-attack

COLOMBO/BENTOTA, Sri Lanka - Sri Lanka's $4.4 billion tourism industry is reeling from cancellations as travelers shun the Indian Ocean island after multiple suicide bombings killed more than 250 people two weeks ago.

Suspected suicide bombers from a little-known Muslim extremist group in Sri Lanka attacked churches and luxury hotels in the country on Easter Sunday. Among the dead were worshippers and Sri Lankan and foreign tourists. The Islamic State group claimed responsibility for the attacks.

"It's a big blow to the economy, as well as the tourism industry," Sri Lankan President Maithripala Sirisena said in an interview on Saturday. "For the economy to develop, it's important tourism return to where it was before the attacks."

Net hotel bookings dropped a staggering 186 percent on average over the week following the attacks compared to the same period last year, data from travel consultancy ForwardKeys showed. A decline of more than 100 percent indicates more cancellations than bookings.

Cancellation rates at hotels across the country averaged 70 percent as of Saturday, with the capital Colombo taking a bigger hit, said Sri Lanka's Tourism Bureau Chairman Kishu Gomes.

"Some airlines have also discontinued frequency of flights. Load factor is much lower than it used to be," Gomes said. "It is a worrying factor for sure."

Tourism took off in Sri Lanka, which boasts a 1,600 kilometers of coastline, following the end of the decades-long civil war with Tamil militants in 2009. It was Sri Lanka's third largest and fastest growing source of foreign currency last year. Tourism accounts for 5 percent of the country's gross domestic product.

Decisive policy and security measures will be important to revive the industry and support economic growth, the International Monetary Fund said.

For now, businesses from luxury hotels to beach shacks are facing mounting losses.

In Bentota, one of a string of beach resorts south of Colombo, occupancy rates have plummeted, according to interviews with hotel managers.

Samanmali Collone, 54, runs the seven-room Warahena Beach Hotel in Bentota, where rooms cost 10,000 Sri Lankan rupees ($56) per night. Her hotel had previously been fully booked for the day when Reuters visited on Thursday, but when news of the bombings on Easter Sunday emerged, all of her guests canceled.

"There are no bookings: This week, next month, even in October, they have all canceled," she said, speaking in her deserted beachside restaurant where waiters polished glasses and rearranged tables, but without any sign of any guests arriving.

Collone said if bookings do not pick up soon, she will have to let go some of her 16 employees.

"We have had issues before, but this is completely different," she said.

Reuters