In the previous years, the media would already have been full of articles about preparing for the tourist season. Croatia has the largest share of tourism revenues in GDP in Europe, which reaches almost 20 percent of GDP and employs 11 percent of people. During the coronavirus crisis, the state still has high expectations, as it is an important source of tax revenue for it. However, tourism workers mostly complain and have black forecasts.
‘The further north we go, the better tourism results’
When asked about official estimates that say Croatia could expect 60 percent of the income from tourism realized in 2019 this year, Topalović said that he believes that such an expectation is still too optimistic according to financial criteria.
“Between 60 and 70 percent of the physical traffic, we had in 2019 is achievable this year. If we talked about 70 percent of overnight stays and arrivals, everyone would sign that result at the moment. Still, when we talk realistically about the financial performance, it is probably about 50 to 60 percent of income,” says Topalović, tourism consultant at Horwath HTL.
He added that Croatia does not expect an “even” recovery of tourism, but the results will vary geographically.
“As last year showed, the further north we go along the coast, the better our result is. The reason for this is the geographical position of Croatia. We were lucky that Istria, Kvarner, and the northern Dalmatian counties have relatively good access by road, and people took advantage of that. From Split to the south, the Makarska Riviera, and towards Dubrovnik will continue to have a more difficult situation this year, because the air connection will still not recover,” explains Topalović.
He assessed the actions of the state during the pandemic as good and timely.
“Essentially, in 2020, the state reacted well in terms of maintaining employment in the tourism sector. Job-saving measures came relatively quickly, halting a potential wave of layoffs in the hotel industry. Both the management and the staff were protected, and there were no excessive losses. If the measures are extended until April, they should be sufficient to preserve the stability of the tourism sector,” says Topalović.
‘Now is the time to restructure Croatian tourism’
He says the expectation of a wave of tourists during the Easter holidays as in previous years in these conditions is illusory. Easter comes earlier this year, he says, so traditionally, the pre-season would be weak. But with COVID this year, there shouldn’t be pre-season at all. The first wave of tourists is expected during May, and more intense from mid-June.
When choosing between quality and quantity, Croatian tourism has always gone in the direction of quantity. In 2020, it turned out to be the wrong direction.
“Last year denied populism, where the state, through tax systems and everything it did or did not do, allowed an uncontrolled increase in private accommodation of medium and lower quality. Those who were thinking a step further with quality accommodation this year scored and ensured their stability,” says Topalović.
He added that quality has won this year, regardless of the type of accommodation, and thinks that this is a sign to those who decide and work on legislative frameworks that the state should encourage quality tourism with all its arsenal. Now is the time, he added, to restructure Croatian tourism.
“It’s never a good time for us. When we grow, then we don’t change anything because everything is good. When there is a crisis, we don’t change anything because we need help. The crisis here has shown in which direction the market is going. Croatian tourism has no future if it stays on the concept of a low-budget mass market, which we currently have,” explains Siniša Topalović.
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