In 1966, the Government of Sri Lanka decided to develop tourism in a planned and systematic manner, after identifying the need to set up an institutional framework. The Ceylon Tourist Board, (created by the Ceylon Tourist Board Act No. 10 of 1966,) and the Ceylon Hotels Corporation, (created by Ceylon Hotels Corporation Act of 1966,) were set up to enable this.

Created to promote economic development through the development of foreign tourism, the Ceylon Tourist Board (CTB) was a statutory body that allowed greater freedom in decision making and flexibility in financial management. The first Board of the Ceylon Tourist Board were Mr. A.C.H. De Soysa, Mr. H.W. Jayawardana QC, Mr. Ralph Deraniyagala, Mr. Upali Senanayaka, Dr. P.R. Thyagaraja, Mr. Chandra Cooray (nominee of the Ministry of Finance) and the Commissioner of Local Government as a representative of Local Government.

The Ceylon Hotels Corporation was a Joint Stock Company with public and private sector involvement. It was intended to be the commercial arm of the Government for the purpose of developing accommodation and other facilities for tourists.

The Tourist Development Act of 1968 provided the Ceylon Tourist Board with the statutory authority to develop tourism in a planned and controlled basis. The Tourist Development Act allowed the Ceylon Tourist Board to obtain land (through compensation) for development purposes. The Act also conferred powers for the Protection of Highways and Places of Scenic Beauty and vested authority in the Ceylon Tourist Board for the Registration and Classification of Tourist Hotels and all other tourist services.

The Board’s objectives were to
  • Encourage, promote and develop tourist travel

  • Encourage, promote and develop adequate, efficient and attractive tourist services

The Board identified and developed six main functional areas.
  • Tourism Research and Statistics

  • Tourism Planning and Development

  • Tourism Marketing and Promotion

  • Regulation of tourist facilities and services in terms of the Tourist Development Act.

  • Domestic Tourism and Community Relations

  • Tourism Manpower Development

Four servicing departments, Secretariat and Legal, Administration and Personnel, Finance and Accounts, and Internal Audit were set up. The Ceylon Hotel School was brought under the management of the Board as part of its responsibilities to provide trained manpower for the successful operation of the upcoming hotel industry.

Given the global importance placed on tourism at that time, the Board carried out the following initiatives to develop and promote tourism in a systematic manner.
  • Enlisted the services of an experienced and internationally reputed Tourism Expert, Mr. S.N. Chib, to assist the Board as an Advisor on all aspects of tourism, for a period of four years.

  • Simplified and standardized Frontier Formalities to facilitate travel into and out of the country.

  • Prepared a ten-year Tourism Development Master Plan commencing from 1967, with funding assistance from USAID. For this purpose, the Board commissioned the services of a Hawaii based Multi-disciplinary team of tourism experts.

  • Advised the government to enact enabling legislation to vest the CTB with powers to acquire land for tourism development purposes, introduce classification codes, registration and licensing of all tourist facilities and services, to impose price control regulations etc. This was done by enacting the Tourist Development Act No. 14 of 1968.

  • Established the first National Holiday Resort at Bentota, with provision for development of several hotels by the private sector by providing all infrastructure services.