Sri Lanka had the lowest holiday costs among 40 destinations surveyed at 27.

95 British pounds down 31 percent from a year earlier, with Spain's Costa de Sol area coming second with 37.72 pounds. "UK visitors will have to factor in a new $20 per person visa charge but this is a far cry from the $50 tag first announced and the original plan to charge children under 12 has also been dropped," the report said. "This means that families considering an Indian Ocean trip should find Sri Lanka cheaper than Mauritius or the Maldives." The annual Worldwide Holiday Costs Barometer 2012 compiled by the Post Office's Holiday Money division measures eight items including the price of coffee and beer in a bar and supermarket prices for bottled water, sun cream, insect repellent and cigarettes. The prices are calculated in Sterling pounds. Sri Lanka scored this year with lower prices in Bentota, a resort area in the South West coast, mostly helped by supermarket prices for key items. It was not clear where last year's prices were sourced from. The price of a local beer rose to 1.50 pounds from 1.34 but the price of cup of coffee fell to 47 pence from 63 pence from and a 3-course evening meal for two adults rose to 18.12 pounds from 16.07 pounds a year earlier. Similar meals cost 22.73 pounds in Costa del Sol area in Spain, 20.60 Pounds in Prague in the Czech Republic, 21.82 in Portugal and 34.97 Pounds in Phuket, Thailand, where the baht has appreciated. But supermarket prices in Bentota helped reduce total cost with suncream (factor 15) down to 2.50 Pounds from 5.54 a year earlier, insect repellent down to 1.25 from 3.08 a year earlier. In 2011, Sri Lanka received 106,082 tourists from Britain barely up 0.6 percent from 2010. Britain in the largest source of tourists from Western Europe to Sri Lanka and the second largest overall after India, which sent 173,000 visitors. Sri Lanka's total arrivals were up 30 percent to 855,975 in December. But Vietnam has is showing signs of becoming a key long haul destination, the Post Office report said, with demand for Vietnamese Dong suddenly rocketing from British tourists. Vietnam welcomed 6.01 million tourists in 2011 up 19 percent from a year earlier, the country's statistics office said.

Sri Lanka has been named among the top destinations for 2012 by Conde Nast Traveller, a popular travel magazine after former war-torn areas were opened to tourists. A 30-year war with Tamil Tiger separatists ended in May 2009 and the first new resorts in the east were opened last year, and new ones are being built. "You can find yourself the only tourist in the traditional villages, and the only person on some of the country's most beautiful beaches. Indeed, those beaches on the east coast have fine sand and calm, clear waters, unlike the surf destinations on the west." Sri Lanka's West Coast resorts are popular during the European Winter season when the Eastern coast is hit by a monsoon season. The east is best during mid year when the West Coast is hit by monsoons.

Other Asian destinations to watch in 2012 named by Conde Nast Traveller in 2012 includes Vietnam and Burma, which was subject to an unofficial tourist boycott until recently with opposition leader ung San Suu Kyi under house arrest.