April the 4th, 2024 – The US-EU trade war caused by Donald Trump’s highly criticised moves will have as much of a knock effect for Croatian tourism as they have with more or less everything else. How will that look?
As Novi List/Alenka Juricic Bukarica writes, US tourism could lose out on more than 46 billion dollars from the trade wars initiated by US President Donald Trump. American media reported more on that topic over more these days, referring to the analysis carried out the consulting firm Oxford Economics.
The analysis claims that the White House’s escalation of the US-EU trade war, as well as that with Canada, China and Mexico, combined with other factors, will potentially reduce foreign tourist arrivals to the US this year. The largest projected decline, of 15 percent, is expected from neighbouring Canada. Overall, foreign arrivals in the US could decrease by a very significant 12.7 percent this year.
reduced consumption
Taking into account the reduced spending by American citizens who travel within the borders of their own country, the total spending on travel in the US could thus fall by the aforementioned sum of 46 billion dollars.
Domestic travel in the USA will be negatively affected by slower income growth and higher prices. International travel to the US will be affected by the triple effect of the economic slowdown, a stronger dollar and a growing level of dislike towards the US, according to the consultants.
On the other hand, some announcements suggest that, due to the strengthening of the dollar, others could benefit, most notably tourism in Europe. There has already been a trend of Canadians boycotting their previously very frequent trips to the US. Instead of crossing their nearest border, they are turning to Europe.
with trump’s us-eu trade war, what can we expect for croatian tourism?
Katica Hauptfeld, owner of the Katarina line travel agency from Opatija, revealed more about what Croatian tourism can expert expect from the US market.
Before leaving for another large American travel fair, Hauptfeld expectedly said that it’s become very thankless to make any predictions at this time. That’s especially true given that the situation across the world in general is uncertain. That has also been clearly reflected in tourist trends. More precisely, there’s been somewhat of a standstill in bookings.
It should certainly be added that as far as the American market is concerned, Croatia entered a very nice upward trend after the coronavirus pandemic. Across the pond, Croatia is recognised as a less developed in a tourism sense, but still an attractive and high-quality destination.
Americans are the most numerous guests for Croatian tourism when it comes to distant (non European) markets. Last year alone, more than 776,000 arrivals and 2.2 million overnight stays were achieved from US market. That represents a growth of 9 percent in arrivals and 8 percent in overnight stays when compared to 2023.
a drop in bookings and charter cancellations
American guests are the best consumers in Croatia, spending around 300 euros per day.
“Our employees are currently on a tour of this market and it’s clear that Americans are very interested in Croatia. That said, bookings have fallen since the story of the US-EU trade war and the situation involving Ukraine began. Bookings from this market are definitely weaker, and we’ve also had several charter cancellations.
On the other hand, if the dollar is strong, it is clear that Europe will be interesting to American guests because the dollar will be worth more to them here than at home.
“I remember when the American dollar was once worth 8.5 kuna, and the euro was worth 7.5 kuna at the same time. However, it’s difficult to say how this will develop going forward. In general, the situation is quite unpredictable, people are obviously waiting to see how things will develop and it ‘s clear that they’re being cautious with planning. So, there is interest from the Americans in Croatia, but bookings are weaker than last year at this time,” explained Hauptfeld.
She also added that the prices of airline tickets on routes to Croatia from the USA have increased significantly. Business class has increased from 2,500 to 5,000 euros. In addition to that, US seniors who tend to book better accommodation generally don’t buy economy class tickets. That means that the price of their trip to Europe has already doubled from the start.
Croatia is not exactly known as a cheap destination on the American market. That being said, typically, Americans are guests who really appreciate good quality and are strong consumers.
“It’s certainly not all roses in tourism right now. Recently, a large agency, Travel Europe, collapsed, which surprised us all. In general, bookings are not at the level they should be at right now. Information from European travel fairs says that everyone has found themselves in a similar situation, that is, reservations are being delayed everywhere,” she explained.
Let’s also add that in these uncertain times, Croatia has scored an own goal by emphasising how expensive it is, and this has done the rounds on a truly global scale. On top of that, this year, taxes related to rental units were raised, so it’s totally illusory to expect that these increases will not be reflected in the final prices.
Agencies also still pay 25 percent VAT on their package deals, the highest of all rates in the surrounding countries. Throw all of Croatia’s own (constant) mistakes into the mixing pot with Trump’s bizarre US-EU trade war and Croatian tourism finds itself in a sticky spot as far as the Americans are concerned.
