ABSTRACT
A 1984 newspaper article by a Reuters correspondent entitled "Riots hit tourist boom" (Geelong Advertiser 23 August 1984) tells how the clash between the army and Tamil insurgents had "badly damaged Sri Lanka's image of an island favourable both to sunbathers and shareholders". It quoted the Sri Lankan Minister of Finance, speaking about the need for political stability in order to bring back tourists and foreign investments. Many hotels in Colombo were being left uncompleted. Many debts incurred could not be repaid, and massive refinancing and rescheduling schemes had to be put into operation (Monetary Board 1990:96). $U.S.1 million had been spent on overseas publicity campaigns to restore Sri Lanka's image abroad, but to no avail. In addition to the continued closure of the Talaimannar Ferry from south India (the entry point to Sri Lanka for many budget tourists), foreign airlines started to delete Colombo as a landing point. In 1986 it was also widely reported that some countries were thinking of discontinuing foreign aid to the island (approximately 60% of Sri Lanka's national budget consists of such aid), given Sri Lanka's inability to solve its ethnic violence (Weekend Australian 18 June 1986). Tamils outside Sri Lanka, it was also claimed, were actively campaigning for aid to be stopped and were also trying to persuade travel agents to stop sending tourists to Sri Lanka.
