Croatian Tourism Income Surpasses 18 Percent of GDP

Total Croatia News

The record tourism season is confirmed by the tourism income in foreign currency of 18.1 percent of GDP, by far the highest in Europe

Croatia ended the 2016 record tourism season with 8.8 billion dollars of foreign currency income from tourism, making up 18.01 percent of the gross domestic product. Also, according to data from the eVisitor system, Croatia made in 2016 16.3 million arrivals and 91.3 million overnights, an increase of around 11 million overnights compared to 2015.

The 18 percent share in GDP demonstrates the catastrophic economic state of Croatia.

For years we have been relying on income from tourism which have literally been saving the state from bankruptcy, an alarm going off for a long time that something is definitely not right with the Croatian economy, but still there is no real answer or reaction.

Naturally, the rise of income from tourism is good news in itself, but what is worrisome is that one fifth of the state income depends on one sector, especially tourism which is prone to various outside factors which we cannot control. Hence, the economic share of all sectors in the GDP presents a certain level of resilience to economic crisis, meaning the entire state depends on good weather in the two main summer months. If July and August are mostly rainy, the state will enter bankruptcy. Safety conditions in Croatia are currently favourable and should not be bragged about in order to avoid provoking an unpleasant situation. Also, the condition in the Mediterranean is far from ideal and it is certain that some of the tourism traffic has been redirected to Croatia.

It would be optimal for the tourism share to be a maximum of five percent, but the problem is not in tourism but in other sectors which are not up to par. Especially production and export which should be (along with year-round tourism) main domestic economic branches. The 18.1 percent share of tourism is by far the highest in Europe. Germany stands at 1.1 percent, Italy 2.2, France 1.9, UK 1.6, Spain 4.7, with Cyprus, Malta and Croatia at the other end of the spectrum, with 12.8, 14 and 18.1 percent respectively.

As I have cited, this is not a problem of tourism, but a poor condition of the state and other economic sectors. Unfortunately, this tells us we have already failed a while ago, but are not aware of it. Question is what next and how will the state find money for its expenses. There is already high tax burden, countless excises, low level of competitiveness, large administration and a too large public sector financed by the private sector. All this and more keeps stifling production and entrepreneurship, especially small and medium business which should be the core, with youth and experts leaving Croatia. What next? A tax on air?

One of our main tourism problems is seasonality which stems from the fact we do not deal with tourism development strategically or long-term. The issue of seasonality clearly presents two facts. The first is that two-thirds of overnights are made in only three Adriatic counties and that 60 percent of total tourism overnights are made in the two summer months.

The only solution to extending the tourism season is through quality content, not relying on the sun and sea. We have it all and we know it all, but still sell sun and sea. Although the situation is changing each year, it is all too slow, more through inertia and down to individual cases. It is incredible how the British sold rain and convinced tourists it is awesome when it rains and that rain in London is a sight to see.

It is out of the frustration and absurdity that we still sell only sun and sea with such riches that my first blog came about, today the leading tourism news portal Tourism is made up of emotions, experiences and stories. And these indigenous, authentic, credible and unique stories must be placed in the service of tourism to reduce seasonality and not depend on rain.

This is the essence of tourism – meeting new cultures of living through history, identity, customs and gastronomy. Let us be what we are – be Croats, as this is what tourists want to experience, taste and meet – our real destination experience, not copies.

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