Tourism would be the second largest forex earner for SL – Hiran Cooray

I proposed to the chairman tourist board to declare 2016 as the year of tourism. I firmly believe that in 2014 we will easily reach 1.5 million tourist arrivals to Sri Lanka. These were some of the thought provoking comments made by  veteran hotelier, Jetwing hotels Ltd., Chairman Hiran Cooray, in an exclusive interview with Ceylon FT.  Hiran envisages tourism to be the second largest foreign exchange earner for Sri Lanka within the next five years.

By Rishar Saleem

Q: How was the performance of Jetwing group in 2013?
A: I think every year YoY performance has been improving and this financial year which is to end very soon has been a record breaking year. Thank God it gets better and better.

Q: What can you say about the tourist mix that visited Jetwing during the season?

A: It is a very healthy mix that we have now. There was a time when we were dependent on western tourists, but now from Western Europe there is a flow of 50% and the balance 50% is from India, China, Middle East, Australia, New Zealand and South East Asian countries like Thailand. This is an absolutely healthy mix to us.

Q: The general accusation about tourist arrivals here is that they are from low income category. What is your opinion on this?
A: Not any more. We get a good mix which consists of high spenders and budget tourists as well which I believe a country must have. No country ever can claim that we have only high spending tourists. Some time today’s backpacker could be tomorrow’s high end customers. Backpackers cannot be taken lightly. They are the explorers. Sometimes they go to places where the local do not go; they go and explore and popularize the place.

Q: In 2010 you mentioned that the firm was setting up eight new hotels with an investment of Rs 6 billion. Of that Yala was opened recently. What is the latest progress on it?
A: It was probably in 2012 that we came up with that; yes, yala is already completed. Colombo is under construction now. Colombo is located in Ward place which will comprise 70 rooms and 28 Villas, and construction is currently on-going. Under the same Jetwing symphony holding company we planned to build in Dambulla; all the approvals have been obtained, and within the next month we will start building there. We will also build in Trincomalee, Uppuveli and also in Arugambay in Potuvil. All these come under Jetwing Symphony holdings.

We also have an investment in partnership with another investor and started to build in Jaffna. We also have started another project with another family in Wellawaya. This is a completely different agro based tourism product. Construction will start in May 2014 in Wellawaya.

Q: Getting back to Yala, how is it progressing?
A: Well, we started in October, and ran into high season, and Yala is enjoying good business. In Yala 80 rooms are completed, 10 Villas will be operational by April.

Q: In an earlier report you confirmed that Jetwing Jaffna would be completed by the end of 2014. Is it a feasible target?
A: Yes, we were targeting it for middle of 2015. Because there were delays in obtaining some of the approvals; we had some minor issues, now all those are cleared and work has commenced.

Q: How is the approval process. Is it really a hard task?
A: It is lot better compared to some years ago, but still takes some time because approvals have to come through different authorities so that it takes little more time.

Q: With the dawn of peace, how much have you invested in the expansion process?
A: My goodness quite a lot! We started off by transforming our existing hotels. I can go from A to Z. We started off with Jetwing Sea and Jetwing Blue; invested US$ 4 million on Jetwing Sea and about US$ 9 million on Jetwing Blue just to transform them into luxury hotels. Then we bought the old ‘Blue Lagoon’ hotel and completely transformed that with US$ 12 – 13 million. Then we build Yala which is about US$ 18- 19 million which totals up to nearly US$ million 50.

Q: You also mentioned that the company was keen on listing on the CSE. When do you think you all would enter the market?
A: We will be listing Jetwing Symphony soon. Once these hotels are completed; Colombo, Dambulla, and Tricomalee, we will list. We don’t know, but roughly in four to five years time.

Q: How was the performance of the overseas hotels?
A: Well, New Zealand we still own and manage that. It has gone through some rough times because of natural disasters and their unstable economy too affected it. Now it is just coming back on track again and we are very pleased with that. Our joint venture in Vietnam and Indo China has come to a bit of a standstill because our partner ventured out into a new business model. The company still remains, but we are not managing the hotel any more.

Q: Jetwing hotels joined MMBL Group to introduce the house boat concept for the first time in Sri Lanka. What is the latest progress of it? How much stakes do you all have invested?
A: We are very excited about it. It is one of a kind, a ‘first’ in Sri Lanka and now we have got approvals and are waiting to clear one or two small hurdles, and we will launch it in mid-May. It is a two bed roomed luxury vessel. We have planned to sail on Bentota waters and stay overnight closer to Sinharaja and come back. I think these are the kind of new development that tourist industry needs. This gives different experience to the customer. This allows the customer to experience different vistas, landscapes and a totally different experience.
We are coming back after a terrible war. Just five years. Innovations start to come gradually. People, those who were in the hospitality sector like us for over 25 years have not made any money. Confidence levels were so low; it is only now that the industry is making money, getting more confidence, and now we are venturing out into new concepts and innovations.

Q: Other than this do you have any other innovative products?
A: Yes we do. In a very small scale loris conservation is one such initiative only by Jetwing; loris park we have at loris habitat in Jetwing Viluyana. We have about six acres of land dedicated to the Red slender loris it is becoming a huge hit now where our guests take a walk and introduce them to not only to loris but to other nocturnes animals. People pay as much as US$ 30 per walk. Not only our own in-house guests; those from Kandalama, Habarana, and other different places come there to experience it. If we don’t show the loris we give the money back. At the moment only we have a loris conservation area.

Q: As a veteran in the tourism industry; how has the tourism industry has evolved and improved during the past five years?
A: So far, we are pleased with the progress of the country. The infrastructure development happening at a rapid pace and it is hard to keep up with the changes; the roads are being built, areas are being cleaned, the safety for the traveller is good. In any country the number one ingredient for tourism is safety and security. We in a beautiful island; now finally we are able to say we provide safety and security. That is the most important aspect. All we have to do is ensure customer needs are being taken care of. Tourism will continue to grow hopefully within the next five years, and this will be the second largest foreign exchange earner of the country.
The other good thing in tourism is the money filters down to many people. It could be Farmer, vegetable supplier, Tuk – Tuk driver, the one who take visitors down to walk. In tourism 80% of foreign exchange earned will remain in the country. It would filter down which is a good thing.
Now ‘home stay’ tourism is catching up. If you have a house you can accommodate tourists. You get additional income. Your living conditions are going to improve with that. With this the money circulation in the economy improves.

Q: What needs to be improved further? Do you think SLTB is doing enough or doing effective marketing to promote Sri Lanka as a tourist destination?

A: Now I think it is beginning to do well. Campaigns are on now; destination branding, destination marketing, is on very aggressively in Europe, in Asia, India and China. I am quite satisfied with the way things have turned around. The way they are approaching there are taxi campaigns, there are television campaigns, and there are road shows. Recent held Berlin campaign too was very successful. Over 150 foreign journalists were present at the press briefing. It wasn’t like this before. This is very soothing sight to see.

Q: What are the global tourism trends that would impact positively to boost Sri Lanka tourism?
A: One trend is the economy in Europe is slowly picking up. This is very healthy. Australia, Middle East economies are doing well. When the economies are doing well obviously people have money and will travel more that is the best things ever happen to tourism industry. Air line fuel has been fairly stable. More airlines touching down in Sri Lanka frequently this is too a good indication.

Q: What are the growth expectations for this year for Jetwing group?
A: Last year to this year the turnover growth was 35% and profit growth is around 40%. Expectation on turnover gain is around 15% on turnover and 20% profits for this year.

[Via Ceylon Today]