Risk & Crisis Management in Tourism Sector:
Recovery from Crisis
in the OIC Member Countries
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Specifically in terms of tourism, in 2005 the government introduced Tourism Act. No. 38 which
reorganized the management of the tourism sector. It came into effect in 2007 with four
organizations, namely: the Sri Lanka Tourism Development Authority (SLTDA); The Sri Lanka
Tourism Promotions Bureau (SLTPB), which handles marketing and promotion of tourism; the Sri
Lanka Institute of Tourism and Hotel Management to manage the human resources and Hotel
Schools, and the Sri Lanka Convention Bureau. The government constituted also the Tourism
Development Fund, made up from 33% of Airport Tax (effectively a departure tax) and 1% of the
turnover of all establishments registered with Sri Lanka Tourist Board (Buultgens et al, 2016).
Putting these new structures in place meant that immediately after the end of the conflict in 2009,
tourism in Sri Lanka was well placed to build on its recovery. International arrivals recorded a
compound annual growth rate of almost 20% between 2009 and 2016 and a compound annual
growth rate of about 31% in foreign exchange earnings over the same period, while in terms of
direct employment, jobs in tourism have almost tripled from 52,071 in 2009 to 146,115 in 2016
(SLTDA, 2012; Bhandari and Goel, 2017).
In 2010 the government announced a development policy framework –Vision for the Future –
which included a focus on sustainable development and diversification of the tourism sector, with
the stated aim of providing benefits to all segments of society. As part of this, the six-year Tourism
Development Strategy (2011-2016) outlined as its main strategic targets the diversification of the
tourismoffer, focusing on newmarkets, development of the infrastructure, improving services and
human resources, promoting domestic tourism, enhancing industry professionalism, and
conserving the environment. Although the hoped-for increase in jobs to 500,000 by 2016 was not
borne out, in terms of tourism earnings the official figure released by SLTDA for 2016 was US$
3,518.5million., much higher than the amount of US$ 2,750million. targeted in the strategy (SLTDA,
2012).
In order to regulate future tourism development projects, the government announced 45 tourism
zones, including locations in the northeast of the country. Each zone had a specific theme for
marketing purposes. These zones were intended to attract foreign investors in the high-endmarket
including hotels as well as recreational and sport establishments, shopping centers and light
aircraft services (Buultgens et al, 2016). In order to attract more investors in tourism, the
government offered tax incentives on project investments exceeding US$ 500,000. It also
announced a Unit for National Investment in Tourism, the ‘One Stop Unit (OSU), as a centralized
contact point for investors seeking information on the tourism industry, including help with all
formalities. Further efforts to attract investors and enhance economic development after 2009
included modernising the infrastructure in the island, including roads, railways, ports and air
transportation. In addition, improvements in power and telecom sectors are also underway
(Bhandari and Goel, 2017).