Sri Lanka tourism revenue declined in November 2025 despite strong growth in visitor arrivals, highlighting the underscored impact of revised spending estimates and structural shifts in travel behaviour that are reshaping the island’s post-crisis tourism recovery.
Sri Lanka tourism revenue dips despite rising arrivals after survey revision
Sri Lanka tourism revenue recorded a notable contraction in November 2025, falling 7.8 percent year-on-year to 251.6 million US dollars, according to official data released by the Central Bank of Sri Lanka citing figures from the Sri Lanka Tourism Development Authority. The decline came despite a robust increase in tourist arrivals, underlining a widening disconnect between visitor numbers and foreign exchange earnings.
The November performance marked the third monthly decline in tourism earnings within the past five months, reinforcing concerns about the sector’s revenue momentum during what was expected to be a stronger recovery phase. Tourism officials and central bank representatives attribute the weaker revenue figures primarily to a revision in per-day tourist spending estimates introduced earlier this year, which has lowered reported earnings since August.
While Sri Lanka welcomed 212,906 foreign visitors in November, a 15.6 percent increase from the same month last year, the higher arrivals failed to translate into stronger income. Analysts say this divergence reflects changing travel patterns, with a growing share of independent travellers staying longer but spending less per day, a trend that has altered traditional revenue assumptions.
The revision to daily tourist spending estimates has had a pronounced impact on reported earnings across recent months. In July, tourism revenue declined 3 percent year-on-year to 318.5 million dollars, followed by a sharper 8.2 percent drop in August to 258.9 million dollars. After marginal improvements in September and October, November once again recorded a contraction, reinforcing the volatility seen in monthly performance.
Despite the short-term declines, cumulative earnings for the first 11 months of 2025 rose 3.7 percent to 2.91 billion dollars compared with the same period last year. However, this growth remains well below earlier projections, effectively ruling out the government’s ambitious targets of 5 billion dollars in tourism revenue and three million tourist arrivals for the year.
Tourism officials have acknowledged that Sri Lanka is likely to miss both benchmarks, citing not only revised spending estimates but also weather-related disruptions and lingering structural challenges. The devastation caused by Cyclone Ditwah in central districts such as Kandy and Nuwara Eliya is expected to weigh on arrivals in early December, potentially extending the revenue shortfall into the final weeks of the year.
The broader context underscores the fragile nature of the sector’s recovery. Sri Lanka tourism revenue reached 3.17 billion dollars in 2024, reflecting a strong 53.2 percent rebound from 2.07 billion dollars in the previous year. While that surge was widely welcomed as a turning point, the current year’s performance suggests that sustaining growth will require more than headline increases in arrivals.
Visitor numbers have continued to rise steadily. In the first 11 months of 2025, Sri Lanka recorded 2,103,593 foreign arrivals, representing a 16.6 percent increase compared with the same period last year. This followed a 38.1 percent jump in arrivals in 2024, when the country welcomed approximately 2.05 million tourists but still fell short of its 2.3 million target.
Economists note that while arrival growth supports employment and activity across hospitality, transport, and retail sectors, revenue quality remains critical for macroeconomic stability. Tourism accounts for nearly 3 percent of Sri Lanka’s economy at present, down from almost 5 percent at its peak in 2018. The sector has faced repeated shocks over the past six years, including the Easter Sunday attacks in 2019, the global Covid-19 pandemic, and a severe domestic economic crisis.
The revised earnings methodology is based on a survey conducted by the Sri Lanka Tourism Development Authority, which captures evolving traveller behaviour. Officials say the updated approach provides a more realistic picture of actual foreign exchange inflows, even if it results in lower reported revenue figures in the short term.
From a balance-of-payments perspective, tourism income continues to play a stabilising role. As earnings flowed in during the year, imports and the merchandise trade deficit gradually expanded, reflecting increased domestic spending by workers and businesses linked to the tourism sector. Policymakers view this as a sign of economic normalisation, though they remain cautious about external vulnerabilities.
Looking ahead, industry stakeholders argue that boosting Sri Lanka tourism revenue will depend on diversifying source markets, encouraging higher-value travel segments, and strengthening destination resilience against climate-related disruptions. Investments in infrastructure, destination marketing, and product development are seen as essential to lifting average visitor spending without sacrificing arrival growth.
While November’s data highlights near-term pressures, tourism authorities maintain that the sector’s medium-term outlook remains positive, provided structural reforms and data-driven policy adjustments continue to align expectations with evolving market realities.