The world financial crisis will cut 2009 tourist arrivals in Sri Lanka to their lowest level in seven years, potentially stripping gains expected as a 25-year war nears an end, tourism officials said. Tourism is the Indian Ocean island nation’s fourth-biggest source of foreign exchange after garments, remittances, and tea, and is an industry that has stayed alive during a war with Tamil Tiger separatists that started in 1983. But even with the military attacking the Tigers’ last bases and victory looking close, the industry is already struggling to find cash for new investments and losing its best workers to better-paying markets. This year looks worse.

[Full Story]

[Reuters]

Sri Lanka’s media is paying a heavy price after getting entangled in a political struggle between President Mahinda Rajapaksa’s ruling coalition and an opposition with few means to challenge his leadership. Events in Sri Lanka have grabbed more world headlines than usual so far this year. First, for a string of military victories over the Tamil Tiger separatists that have raised the prospect of an end to the island’s 25-year war and brought Rajapaksa a popularity windfall.

[Full Story]

[ AP ]

Sri Lanka’s Tamil Tiger separatists are open to restarting peace talks with the government, despite the continuing military offensive aimed at crushing the group, a senior rebel official said. The two sides have been fighting for more than 25 years over the rebels’ demands for an independent state for minority Tamils in the north and east of this Indian Ocean island nation. A new military push deep into the rebel heartland in recent months has forced the Tamil Tigers to retreat from vast swaths of land they once controlled, and the government has said it expects to finish off the group in the coming months.

[Full Story]