Croatian Travel Agencies Worry About Life After Government Measures End

Lauren Simmonds

Copyright Romulic and Stojcic
NP Plitvice Lakes, Croatia
NP Plitvice Lakes, Croatia

As Marija Crnjak/Poslovni Dnevnik writes on the 22nd of May, 2020, so far, as many as 80 percent of clients of Croatian travel agencies have agreed to accept vouchers instead of refunds, and with ”voucher measures” and the introduction of a moratorium on refunds, agencies are protected with around 200 million kuna, the Association of Croatian Travel Agencies (UHPA) revealed.

However, the turnover of Croatian tourist agencies is still close to zero, nobody has started entering their branches just yet, even though they have opened again, and the question is how these agencies will survive if the minimum wage measure is not extended.

In addition, due to the general uncertainty, it’s more difficult today to find insurance companies that will gladly agree to issue guarantee insurance policies, which is a legal obligation of such agencies. In her open letter, Sonja Lovrentjev, the owner of a Zagreb agency called Obord, which normally organises the travel of preschoolers, warned of these issues.

“Insurers are telling us that they don’t want to issue this type of insurance, because the risk is too great, but in the event that Croatian travel agencies issue travel vouchers or sell trips without a valid insurance policy, they operate against what the law prescribes. Therefore, it isn’t clear to us whether vouchers can be issued only by those Croatian travel agencies that currently have a valid guarantee policy, and what if, at the time of issuing, the voucher the agency provides has a valid insurance policy, but it ceases to be valid in the new travel period?” asks a concerned Lovrentjev.

UHPA President Tomislav Fain confirmed that UHPA is aware of the problem of guarantee insurance, and is currently in negotiations with two insurance companies that will issue it, namely Triglav and Adriatic osiguranje.

“Insurance companies are private companies that also need to assess their own risks, but we still managed to agree to continue with these policies, and in addition to the insurance policies, the Act also provides bank guarantees,” explained Fain.

Additionally, Fain is convinced that the Croatian Government will comply with the UHPA’s request to extend the minimum wage measure for agencies for more than three months, noting that only those with a drop in turnover of 70 percent will receive compensation. He stated that it was worth remembering that Croatian travel agencies were the first to feel the negative effects of the ongoing coronavirus crisis and will probably be the last to get out of it, too.

“We’re aware that due to the possible danger of contracting the infection, it isn’t possible to open everything we want to open and that it isn’t possible to start working in the way we did before the pandemic struck. We’re all aware that there is a period ahead of us in which we will generate very little income, and I’m glad that some of my colleagues had their first groups on day trips to Plitvice Lakes National Park last weekend, which reduced ticket prices encouraged by our letter. In one TV show, we discussed the drop in traffic, and our colleagues from other industries talked about how much traffic fell and for whom it fell, and when it was my turn, I said that we have no traffic, that our turnover is 0.00 kuna,” concluded Fain.

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