The Sri Lanka Tourism Development Authority (SLTDA) is set to initiate a leakage survey later this month to accurately assess tourism revenue, as announced by its chairman. Following the latest survey conducted earlier this year, the SLTDA has adjusted the estimated per day spending by foreign visitors to $148, down from the previously established $171 determined a decade ago.

Buddhika Hewawasam, the SLTDA Chairman, informed reporters at a media briefing in Colombo on Monday that the upcoming leakage survey aims to ascertain how much of the $148 remains within Sri Lanka.

In the context of tourism, leakage refers to the portion of tourist expenditure that exits the host country’s economy rather than circulating locally. This can occur through various channels such as the importation of food and beverages for tourists, profit repatriation by foreign-owned hotels or airlines, remittances by foreign workers, and overseas marketing expenses.

While some level of leakage is unavoidable in any open economy, excessive leakage means that only a small portion of tourism revenue benefits local communities, employment, and development efforts. A leakage survey systematically measures the extent of this outflow by analyzing data on supply chains, ownership structures, import dependencies, and spending patterns.

For countries that rely heavily on tourism, particularly developing or island nations, conducting these surveys is essential for accurately assessing the true economic benefits. The data can inform policies aimed at reducing leakage, promoting sustainable and equitable development, enhancing competitiveness and resilience, and supporting responsible tourism objectives.