- Industry leaders urge Tourism Min. to extend MRR policy
- Increased revenue projection spurs call for standardised rates
Hoteliers are seeking Government intervention to formalise the gentlemen’s agreement reached within the industry to increase the prices of rooms by extending the Minimum Room Rate (MRR) to the entire country.
Speaking to The Sunday Morning Business, former President of The Hotels Association of Sri Lanka (THASL) and Mount Lavinia Hotel Chairman Sanath Ukwatte stated that following discussions, hoteliers had arrived at an informal understanding to increase the room rates for next winter due to increased expenses.
Accordingly, they are hoping for the intervention of the Ministry of Tourism to formalise the agreement by introducing an MRR applicable to the whole island.
He pointed out that even if the number of arrivals were to decrease, the increased revenue would more than compensate for such a loss.
“The country is losing a lot of revenue because of these low rates. We don’t want to attract low-paying customers; we need to attract high-paying customers. We don’t mind even if we lose some business, given the current trend where demand is surpassing our supply,” he stated.
Ukwatte further stated that such a decision would benefit the entire industry since the staff would then become eligible to earn a higher service charge.
Speaking to The Sunday Morning Business, Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando confirmed that discussions had been carried out among hoteliers to introduce an islandwide MRR. However, he noted that the SLTDA was yet to receive such a request in writing.
He said: “Ideally, we would like them to resolve these issues by themselves by reaching a gentlemen’s agreement and move forward – a situation where whatever they agreed on is honoured, rather than getting the authority or any other institution involved.”
Fernando further stated that the situation in the industry had changed to one where demand was exceeding supply. Therefore, since issues such as undercutting prices were no longer a concern, hoteliers should be able to resolve this by themselves, he noted.
Source: Sunday Morning
