📉 Tourism Outlook: Record Growth Hit by Middle East Volatility

Sri Lanka’s tourism sector faces sudden uncertainty following the conflict in the Middle East, threatening to disrupt the momentum of a record-breaking start to 2026. • Record Performance: February 2026 saw the best-ever arrival figures with 253,293 tourists, surpassing the previous 2025 peak (240,217) and 2018 (235,618). • Growth Drivers: Gains were driven by the hospitality and retail boost from the England Cricket Team tour (Barmy Army) and the ICC T20 World Cup, attracting high-spending European travelers. • Logistical Disruptions: Over 60% of high-spending Western tourists transit through Gulf hubs like Dubai and Doha. To date, 115 flights between Sri Lanka and the Middle East have been cancelled due to airspace closures. • Economic Risk: The conflict jeopardizes the national target of 3 million arrivals for 2026. Increased fuel costs and rerouting are expected to hike airfares, deterring long-haul travel. • State Response: The Government has granted a free two-week visa extension for stranded visitors. Authorities are urged to ensure the hotel and leisure industry avoids price exploitation during this crisis. • Regional Impact: Nearby Maldives warns of a potential 35% drop in arrivals if disruptions persist, highlighting a broader threat to South Asian travel & leisure markets.