Tourism Development in Northwest Sri Lanka Attracts Investments. Construction Work of a Hotel in Kuchchaveli Underway

26th April 2011, www.island.lk, By Mario Andree

Sri Lanka Convention Bureau General Manager Vipula Wanigasekera said construction work of one hotel in Kuchchaveli, Northwest Sri Lanka off Trincomalee, has commenced after investors successfully completed interviews with the Treasury. He declined to disclose who the investor was.

The Island Financial Review last month reported that the government signed five MoUs with three local and two international investors to develop Kuchchiveli.

Authorities are planning to lease 500 acres of land in the North East coast to potential investors at Rs. 20 million an acre in order to develop tourism infrastructure.

Wanigasekara said only one bid was so far finalised while the others were still being processed.

He said the Kalpitiya islets project also captured the attention of many large investors who are pouring in their proposals, however the government is yet to make a decision.

The Kalpitiya project earlier attracted 11 bids which were rejected because the government felt that the islets had more earning potential.

Sources told The Island Financial Review the new hotel in Kuchchaveli was being built by the International Construction Consortium. Further, 11 plots of land also have been recognized in Hambanthota for development and already 7 investors have sent in their proposals.

Sri Lanka expects 800,000 tourists this year while capacity constraints loom around the country, several investors have bided to develop properties in order to support the growth.

Tourist Hotel Association, President, Anura Lokuhetty said the country would reach 800,000 tourists this year while more rooms are being built to support the future growth.

He said Sri Lanka is on track of achieving 2.5 million tourist arrivals by 2016 while the room capacity is expected to increase by more than 30,000.

Last year, arrivals grew 46.1 percent recording 654,476 tourists, for the first three months this year increasing by 34.1 percent to 215,124.

Lokuhetti said considering last year’s growth the sector expects the numbers to grow within the capacity available.

The country has 15,000 hotel rooms in the formal sector and 7,000 in the informal sector, which could support nearly 900,000 at an average 6 nights stay.

Related Info :

• Land for Lease in North & East Sri Lanka for Rs20mn an Acre for Tourism Development

• Masterplan for Tourism Development of Kuchchaweli Area - The Longest Coatal Belt of Trincomalee