- Event Management Association of Sri Lanka says industry is seen as the sector most vulnerable to any disaster
- Alleges Rs. 36b industry is losing skilled staff as it moves to other sectors to earn a living
- Claims debt moratoriums have deepened the financial miseries of its members
- The remaining states of the member companies are operating in great difficulty
- Opines Rs. 500m grants reported in 2022 budget, left as mere proposal
- Suggests that political stability and investor confidence are the only path to recovery
- Said if the government. remains without lasting solutions by next month, the domino effect will lead to complete economic bankruptcy
By Charumini de Silva
The multiple crises have forced the multi-billion rupee event management industry into a destitute state, making it one of the ‘most vulnerable sectors’ to any disaster.
The Event Management Association of Sri Lanka (EMA-SL) said that following the multiple crises the industry suffered following the Easter Sunday attacks in 2019, most trained staff have now moved to different sectors to earn a living.
The event management industry is worth over Rs. 36 billion and is among the Rs. 150 billion in the marketing communications sector.
“Our industry has started to be affected since the April 2019 Easter Sunday bombings which resulted in the cancellation of all hotel events where many restrictions came into play from venues due to security concerns . The situation has worsened following the COIVID pandemic since our sector has been closed for 18 consecutive months.
“Subsequently came the myriad of crises ranging from currency, power and energy which also ushered in a political revolution. Due to these multiple factors and impacts, our industry today is at a standstill and in a state of destitution,” EMASL chairman Nishan Wasalathanthri told the Daily FT.
Although it attracts foreign currency into the economy, especially through Meetings, Incentives, Conferences and Exhibitions (MICE) events, the industry has provided employment for over 130,000 jobs and 600,000 livelihoods.
“Given the vulnerability of the industry, those who were part of the sector will never even consider returning. Four years ago we had 65 member companies and now there are only 50 members. The severity of the economic impact is enormous,” Wasalathanthri added.
He also claimed that debt moratoriums have deepened the financial misery of his members.
“Almost all of the members got the install thinking the industry would be back to normal after COVID, but now that the grace period is also over; businesses are obligated to pay the loans. They are in deeper financial misery as they now have to pay off more and more debts and interest rates without stable income. Given the current economic crisis, none of the companies are in a position to reimburse,” he explained.
“We are a local industry with local talent and investment. Nobody thinks about all the procedure that goes on behind the scenes to organize massive events. This is not limited to the price of a ticket but includes many technical and creative aspects to make an event memorable. All of our members are registered and contribute to government coffers,” he said.
According to the President of EMASL, many members have also made massive investments, ranging from Rs. 10 million to Rs. 800 million per company, on infrastructure, equipment and skills development.
“Without work for four years, this equipment and devices worth millions have malfunctioned or been completely damaged,” he said, adding that it was difficult to quantify the economic impact following the multitude of crises.
He said events are seen as essential for businesses as a vital “live communication” tool, which enables a cross-section of industries to introduce new products to market and generate sales. In this context, a high frequency of corporate events is often correlated with a healthy economy.
The President of EMASL also pointed out that the remaining member companies are operating in great difficulties, with the government’s inability to provide solutions to the electricity and energy crisis.
“Our members run businesses with the greatest difficulty because most of them have financial commitments. In terms of transportation, collecting fuel for generators, finding generators, the limitations of dispensing fuel, especially for cans, have become a daily problem for the entire industry,” he said. -he adds.
Wasalathanthri also claimed that the Rs. 500 million grant declared in the 2022 budget to compensate for the losses incurred during the COVID pandemic, remained just a mere announcement.
“Although the allocation of Rs. 500 million was not enough, we believed the government had at least recognized our industry after painstakingly building it up over the past 30 years. To our surprise, the budget proposal has so far remained a mere announcement,” he said.
He also shared recommendations to revive the economy and industry without further delay.
“The only way for the recovery of the industry is through political stability and investor confidence. Forced direct investment must come to Sri Lanka and not in the form of loans. The country must invest in the development of manufacturing industries. export and convert all loss-making state-owned enterprises (SEs) into for-profit modules by moving forward with public-private partnerships (PPPs),” he suggested.
Wasalathanthri warned that if the government remained without providing durable solutions by next month, most SMEs in many sectors would collapse, which would then lead to a domino effect where banks and financial stability would start to crumble. with an unbearable amount of non-performing loans. (NPL) and the consequences of credit card failures – leading to complete economic bankruptcy.