"The December 2004 tsunami killed more than 30,000 people and caused large-scale damage along the eastern, southern and south western coastline of Sri Lanka. Most hotels and other tourist accommodation in the south and south-west have reopened. If you are planning to travel to areas which may have been affected by the tsunami, check with your tour operators and/or hotel to make sure that tourist facilities are available."
I went there very shortly after the Tsunami, and although there was complete devastation and tents everywhere, the hotels and all the facilities for tourists were back in working order. I can't give you a more up to date report, but the people were desperate for tourists to return because tourism means employment.