Sunday, 18 August 2019
Englishman in Dubrovnik Englishman in Dubrovnik

Croatian tourism - not be a case of, from boom to bust, more a case of from boom to balance

By  Mar 16, 2019

Every sun must set. Yes, all good things come to an end, it probably isn’t the end, far from it, more like a rebalance. And it isn’t a bump in the road more like an inevitability. If you have a half litre beer glass you can’t pour a litre into it. After more than a decade of ring the crest of wave of the tourism industry Croatia could well hit the beaches this year.

Croatia, and especially Dubrovnik which is the jewel in the tourism crown, is facing a challenging year in the tourism industry. Bookings are slowly down, and the predictions are for a minimal increase in tourist arrivals. It may not be a case of, from boom to bust, more a case of from boom to balance.

And just why is the tourism market looking less promising, well it is a perfect storm (or maybe imperfect storm) of many factors that have all come together this year. In short it’s the three B’s – Bodrum, Brexit and Berlin. With the rise of Turkey and Greece back to the levels they were some years ago, as well as destinations in North Africa, which until now have been “off limits” for tourists slowly coming back the new/old competition will mean challenging times. Whilst the Turks are dumping prices, and the Greeks aren’t far behind, Croatian hotels and tourism agencies have been slow to respond and are now seeing large holes in the reservations for this year.

I am being bombarded with owners of private accommodation who are worried that their apartments will remain empty through the summer months. Clearly this will prove a huge financial problem for renters who have buried themselves in huge loans to finance either building, buying or adapting rooms for tourists.

As one economic expert explained to me just last week, “Tourism is a sensitive and fluid business, whereas history shows us that investing into tourist accommodation makes commercial sense, the future could show that this was a false hope.”

And throw Brexit into the mix and the chaos reaches new heights. Although the British tourists who have already booked their fortnight in the Dubrovnik sunshine through an agency will certainly arrive, in fact hotels in the city are reporting that agency UK bookings are around the same as last year, there has certainly been a slowdown with individual British tourists. If Brexit brings a fall in the value of the pound then this will also obviously effect the spending power of Brits on holiday here. “We’re seeing interesting booking numbers this year. Tiny numbers from England, usual Irish and lots of US bookings filling the gaps. As Dubrovnik normally has such a large percentage of UK visitors, is this a result of Brexit?” said one apartment owner in Dubrovnik to me. Yes, it is a result of Brexit is the short answer. Instability breeds uncertainty.

And Berlin, the third B, is news from the biggest tourism exhibition in Europe, ITB, which has just been held and again opened some painful questions, such as TUI saying that hotel prices need to be dropped. And obviously the knock-on effect of this will be a required drop in private rental prices. Although this news is concerning for many it hasn’t really come as a shock for me. In fact, I would have been more surprised if double-digit growth was achieved again. There are only so many records you can break before you hit the wall. Expansion is of course limited by possibilities.

And this “correction” of prices and tourist numbers was not only to be expected by is completely normal. For years we have been living the high-life and now it’s time to expect more of a move towards value for money. Trying to sell a Fiat for the price of a Ferrari might bring short-term gains but in the long-term you are going to be left with plenty of unsold Fiats. Dubrovnik is a “Ferrari” destination and should be marketed as such. 2019 will be a healthy breath of common sense into the tourism industry, a much needed “wake up and smell the coffee” moment. I’m not being pessimistic, just realistic.   

The Voice of Dubrovnik


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