CROATIA

Transcription

CROATIA

CROATIA
THE IMPACT OF TRAVEL &TOURISM
ON JOBSANDTHE ECONOMY
CHAIRMAN:
Sir Ian Prosser
Chairman
Six Continents PLC
VICE CHAIRMEN:
Donald Carty
Chairman, President & CEO
American Airlines
Ron Stringfellow
Executive Chairman
Southern Sun Group
Jonathan Tisch
Chairman & CEO
Loews Hotels
Manuel Fernando Espírito Santo
President
Group Espirito Santo
Manuel Martin
Partner
CyberDodo Productions Ltd.
Brett Tollman
Vice Chairman
The Travel Corporation
Sam Galeotos
President & CEO
Galileo International
Paul McManus
Lalit Suri
President & CEO
Chairman & Managing Director
The Leading Hotels of the World Bharat Hotels Ltd.
Laurence Geller
Chairman & CEO
Strategic Hotel Capital
David Mongeau
Vice President
CIBC World Markets
Ian Swain
Chairman & CEO
Swain Travel Services Inc
Maurice H. Greenberg
Chairman & CEO
American International Group,
Inc.
Alan Mulally
President & CEO
Boeing Commercial Airplanes
Kathleen Taylor
President,Worldwide Business
Operations
Four Seasons Hotels and Resorts
GLOBAL MEMBERS:
Akbar Al Baker
Jean-Marc Espalioux
Chairman of Management Board CEO
Qatar Airways
& CEO
Accor S.A.
Giovanni Angelini
CEO & Managing Director
André Jordan
Shangri-La Hotels & Resorts
Chairman
Lusotur S.A.
David Babai
Chairman
Jonathan S. Linen
Gullivers Travel Associates
Vice Chairman
American Express Company
Phil Bakes
Chairman & CEO
Vincent A.Wolfington
FAR&WIDE Travel Corporation
Chairman
Carey International, Inc.
Ted Balestreri
Chairman & CEO
EXECUTIVE COMMITTEE:
Cannery Row Company
Peter Armstrong
President & CEO
Henrik Bartl
Rocky Mountaineer Railtours
Head of Specialized Property
Finance
Stephen Bollenbach
Aareal Bank AG
President & CEO
Hilton Hotels Corporation
Gordon Bethune
Chairman of the Board & CEO
Club Méditerranée
Continental Airlines
Sebastián Escarrer
Paul Blackney
Vice Chairman
President & CEO
Sol Meliá
Worldspan
Edouard Ettedgui
Richard Brown
Managing Director
Mandarin Oriental Hotel Group Chairman & CEO
Eurostar Group
Maurice Flanagan
Regis Bulot
Group Managing Director
President
Emirates
Relais & Chateaux
Bernard D. Frelat
Marilyn Carlson Nelson
President & CEO
Chairman & CEO
Rail Europe Group, Inc.
Carlson Companies, Inc
Michael Frenzel
Alun Cathcart
Chairman
Deputy Chairman
TUI A.G
Avis Europe Plc
David House
Group President, Global Network U. Gary Charlwood
Founder, Chairman & CEO
and Establishment Services
Uniglobe Travel (International)
American Express Company
Inc.
Richard R. Kelley
Jennie Chua
Chairman
President & COO
Outrigger Enterprises, Inc
Raffles International Ltd.
Geoffrey J.W. Kent
David Clifton
Chairman & CEO
Managing Director, Europe &
Abercrombie & Kent
Asia
Interval International
J.W. Marriott, Jr.
Chairman & CEO
Glen Davidson
Marriott International, Inc
Senior VP,Worldwide Travel
Insurance & Related Services
David Michels
American International Group
Chief Executive
Inc.
Hilton Group
Philip Haan
Executive VP International,
Sales & Information Services
Northwest Airlines
Anthony Harris
Chief Executive
Hilton International
Richard Helfer
Chairman & CEO
Raffles International Ltd.
James Hensley
President
Allied Europe
James Hogan
President and Chief Executive
Gulf Air
Stephen Holmes
Chairman & CEO, Hospitality
Division
Cendant Corporation
Raimund Hosch
President & CEO
Messe Berlin GmbH
Dieter Huckestein
President, Hotel Operations,
Owned & Managed
Hilton Hotels Corporation
Xabier de Irala
Chairman & CEO
Iberia
Clive Jacobs
Chairman & CEO
Holiday Autos Group
Nuno Trigoso Jordão
President & CEO.
Sonae Turismo Gestao Servicos
Sol Kerzner
Chairman
Kerzner International Ltd.
Nigel Knowles
Managing Partner
DLA
Craig Koch
President & CEO
The Hertz Corporation
Curtis Nelson
President and CEO
Carlson Consumer Group
Dinesh Dhamija
Chairman & CEO
ebookers plc
Krishna Kumar
Managing Director
The Taj Group of Hotels
P.R.S. Oberoi
Chief Executive
The Oberoi Group
Lloyd Dorfman
Chairman & Chief Executive
Travelex plc
Hans Lerch
President & CEO
Kuoni Travel Holding Ltd.
Henry Silverman
Chairman & CEO
Cendant Corporation
Rod Eddington
Chief Executive
British Airways plc
Paolo Mantegazza
President & CEO
Globus & Cosmos Inc
John M Noel
President & CEO
Travel Guard International
Tom Nutley
Chairman
Reed Travel Exhibitions
Alan Parker
Managing Director
Whitbread Hotel Company
Jean Gabriel Pérès
President & CEO
Mövenpick Hotels & Resorts
Dionísio Pestana
Chairman
Group Pestana
Stefan Pichler
Chairman & CEO
Thomas Cook AG
Fernando Pinto
Chief Executive Officer
TAP - Air Portugal
David Radcliffe
Chief Executive
Hogg Robinson
Jay Rasulo
President
Walt Disney Parks & Resorts
José Antonio Tazón
President & CEO
Amadeus Global Travel
Distribution
Jeffrey Toffler
Chairman
Coventry Partners
Mustafa Türkmen
Enternasyonal Tourism
Investments, Inc.Yapi Kredi Bank
of Turkey
Patrice Vinet
Partner
Accenture
Trevor de Vries
Deputy Managing Director
Mondial Assistance S.A.
Jurgen Weber
Chairman
Lufthansa German Airlines
Peter Yesawich
Managing Partner
Yesawich, Pepperdine, Brown &
Russel
Bonnie Reitz
Senior VP, Marketing & Sales
Continental Airlines
HONORARY MEMBERS:
Lord Marshall of Knightsbridge
Chairman
British Airways plc
Kurt Ritter
President & CEO
Rezidor SAS Hospitality
Sir Frank Moore, AO
Chairman
Taylor Byrne Tourism Group
Peter Rogers
President & CEO
Diners Club International
Frank Olson
Chairman of the Board
The Hertz Corporation
Carl Ruderman
Chairman
Universal Media
Gérard Pélisson
Co-Chairman, Supervisory Board
Accor S.A.
Bruno Schöpfer
Mövenpick Group
Robert Selander
President & CEO
MasterCard International
Per Setterberg
CEO
Global Refund Holdings A.B.
Tommaso Zanzotto
President
TZ Associates Ltd.
CHAIRMAN EMERITUS:
James D. Robinson III
General Partner
RRE Ventures
Eric Speck
Executive Vice President
Group President,Travel
Marketing & Distribution
Sabre Holdings Corporation
IMMEDIATE PAST
CHAIRMEN:
Harvey Golub
Retired Chairman & CEO
American Express Co.
Barry Sternlicht
Chairman & CEO
Starwood Hotels & Resorts
Worldwide, Inc
PRESIDENT:
Jean-Claude Baumgarten
Correct as at 14 February 2003
© 2002 WORLD TRAVEL & TOURISM COUNCIL
1-2 QUEEN VICTORIA TERRACE.SOVEREIGN COURT.LONDON E1W 3HA. UNITED KINGDOM
TEL: +44 (0) 870 727 9882 or + 44 (0) 207 481 8007 • FAX: +44 (0) 870 728 9882 or + 44 (0) 207 488 1008 • [email protected] • www.wttc.org
THE WORLD TRAVEL & TOURISM COUNCIL (WTTC) IS THE BUSINESS
LEADERS’ FORUM FOR TRAVEL & TOURISM, WORKING WITH
GOVERNMENTS TO RAISE AWARENESS OF THE IMPORTANCE OF THE
WORLD’S LARGEST GENERATOR OF WEALTH AND JOBS.
With Chief Executives of more than one hundred of the world’s leading companies in
membership,WTTC has a unique mandate and overview on all matters related to success
in Travel & Tourism.
WTTC is delighted to have collaborated with Croatia’s Ministry of
Tourism and the Croatian Bureau of Statistics to produce this report,
retailing and construction, which would decline if demand for Travel &
Tourism were reduced.
which presents the first Tourism Satellite Accounting research for Croatia.
This significant contribution should not be underestimated, but
Undertaken by WTTC, together with our research partners Oxford
neither should the industry’s potential for growth be taken for granted.
Economic Forecasting, this report quantifies all aspects of Travel &
As illustrated in the Tourism Trends and Policy Framework sections of
Tourism demand, from personal consumption to business purchases,
this report, several important challenges continue to limit Travel &
capital investment, government spending and exports. It then translates
Tourism’s full potential for growth in Croatia, particularly in terms of
this information into economic concepts of production, such as gross
yield.These challenges include the enhancement of product and service
domestic product (GDP) and employment, which can be compared with
quality, as well as the development of much needed infrastructure and
other industries and the economy as a whole to provide credible
human capital.
statistical information that will assist in policy and business decisionmaking.
This report also sets out WTTC’s recommendations on policies that
we believe will help optimize the potential benefits of Travel & Tourism
Results clearly show that Croatia is already highly dependent on
in Croatia, ensuring longer-term sustainable development and spreading
Travel & Tourism, which currently represents 22.4 per cent of total GDP
the benefits across all levels of the economy and the country. Croatia’s
and is expected to increase its share by more than nine percentage points
Travel & Tourism could do even better than the baseline forecasts suggest,
to 31.6 per cent in 2013. Similarly, Travel & Tourism in Croatia today
as long as certain factors are assured – a favourable government fiscal
accounts for 27.4 per cent of total employment, and this is forecast to rise
policy, a climate that is conducive to business offering incentives for
to 33.9 per cent by 2013. The industry’s primary role as a generator of
investment, sustained and effective marketing and promotion, and policies
wealth and employment across all parts of the country is unparalleled by
that respect the environment and local cultures. WTTC stands ready to
any other sector. It also acts as a catalyst for growth in other areas such as
support the adoption and implementation of these policies.
Jean-Claude Baumgarten
Sir Ian Prosser
President,World Travel & Tourism Council
Chairman,World Travel & Tourism Council
Six Continents PLC
The World Travel & Tourism Council would like to express its sincere gratitude to the many individuals and organizations that contributed their knowledge, insight and
data/information to the policy review effort. A complete list of contributors can also be found on the back inside cover. Special thanks are due to THR International Tourism
Consultancy, which made a significant contribution to the section entitled Croatia’s Travel & Tourism: Overview of Recent Trends and Developments.
CONTENTS
EXECUTIVE SUMMARY ____________________________________________________________________________
4
ECONOMIC IMPACT _________________________________________________________________________________________ 6
GROWTH____________________________________________________________________________________________________ 7
FUTURE PROSPECTS _________________________________________________________________________________________ 8
REALIZING THE POTENTIAL__________________________________________________________________________________ 10
CROATIA’S TRAVEL & TOURISM
AN OVERVIEW OF CURRENT TRENDS AND DEVELOPMENTS__________________________________________________ 13
TRAVEL & TOURISM SATELLITE ACCOUNT
TOURISM SATELLITE ACCOUNTING __________________________________________________________________________ 20
TSA CONCEPTS & STRUCTURE _______________________________________________________________________________ 22
TRAVEL & TOURISM’S ECONOMIC IMPACT ___________________________________________________________________ 24
TOTAL DEMAND _____________________________________________________________________________________________ 26
EMPLOYMENT _______________________________________________________________________________________________ 27
GROSS DOMESTIC PRODUCT ________________________________________________________________________________ 28
CAPITAL INVESTMENT ______________________________________________________________________________________ 29
PERSONAL & BUSINESS_______________________________________________________________________________________ 30
EXPORTS ____________________________________________________________________________________________________ 31
GOVERNMENT ______________________________________________________________________________________________ 32
THE POLICY FRAMEWORK
____________________________________________________________________ 33
APPENDIX
SATELLITE ACCOUNT TABLES ________________________________________________________________________________ 46
EXECUTIVE
SUMMARY
CROATIA’S RECENT TRAVEL & TOURISM GROWTH
CONFIRMS THAT IT IS WELL ON TRACK TO RECAPTURE
THE DEMAND LEVELS IT ENJOYED PRIOR TO THE
OUTBREAK OF WAR IN 1990, ALTHOUGH YIELD WILL TAKE
MORE TIME TO RECOVER. MAJOR POLITICAL AND
ECONOMIC REFORMS, WHICH HAVE PROMOTED
STABILITY AND OPEN MARKETS, HAVE CONTRIBUTED
TO STIMULATING GROWTH IN THE SHORT TERM.
CROATIA NOW NEEDS TO ADOPT A COHESIVE, LONGTERM STRATEGY FOR SUSTAINABLE DEVELOPMENT, TO
ENSURE IT ATTRACTS THE RIGHT KIND OF TOURISM IN
FUTURE WITH BENEFITS FOR ALL STAKEHOLDERS.
In 2003, Travel & Tourism is expected to contribute
captures a growing share of international visitor
22.4 per cent of Croatia’s GDP and account for
expenditure, helping to boost the country’s exports and
294,000 jobs, representing 27.4 per cent of total
improve Croatia’s balance of payments.
employment. These impressive shares show clearly that
As the government progressively reduces its direct
the Croatian economy is already highly Travel &
involvement in the industry, as well as accelerating the
Tourism intensive. Current forecasts suggest that, if
privatization of hotels and implementing tough fiscal
certain key factors are assured, Croatia will continue to
policies, investors and tourism operators are increasingly
record above average growth levels over the next ten
being drawn by the investment opportunities the
years. However, this depends on the Croatian
country has to offer. However, government must guard
Government recognizing and supporting Travel &
against too rapid a withdrawal of public sector support,
Tourism as one of Croatia’s highest priority industries
in a rush to meet tight deadlines, since this could work
and employers, factoring it in to all policies and
against the long-term interests of the industry and local
decision-making.
communities.
In the years following the outbreak of war in 1990,
If managed effectively,Travel & Tourism can be an
the near collapse of Travel & Tourism demand placed a
important catalyst for the development of other
great financial strain on the Croatian tourism industry,
economic sectors within Croatia, such as manufacturing,
resulting in an increasingly wide gap between Croatia
construction and the service industries. It can also help to
and competing destinations in terms of infrastructure
protect the country’s primary assets, namely its largely
and product development. On a positive note, the
unspoilt natural and cultural environment. The
complete lack of new development over several years
government has already taken steps to establish a working
has helped Croatia avoid some of the mistakes made by
partnership with the private sector. This will facilitate
its competitors – excessive construction, and the
harmonization of the two sectors’ development targets so
exploitation and over-concentration of natural resources.
that they remain complementary to Croatia’s high-level
Today, these are a major part of the destination's tourism
objectives, such as accession to the European Union.
attraction.
4
Additional measures recommended in this report
The race is now on to upgrade and expand
are intended to set the stage to help ensure the larger
Croatia’s hotel infrastructure and to enhance the
rewards that Travel & Tourism can bring over the short,
competitiveness of its human capital.This will ensure it
medium and longer term.
ECONOMIC IMPACT
IN 2003, CROATIA’S TRAVEL & TOURISM IS EXPECTED TO GENERATE
KN61,485.0 MILLION (US$7,933.6 MILLION) OF ECONOMIC ACTIVITY
(TOTAL DEMAND).THE INDUSTRY’S DIRECT IMPACT INCLUDES:
138,971
19,664.7
jobs __________________ representing 13.0 per cent of total Employment.
Kn
million (US$2,537.4 million) ____________________________ of
Gross Domestic Product (GDP) equivalent to 10.6 per cent of total GDP.
HOWEVER, SINCE TRAVEL & TOURISM TOUCHES ALL SECTORS OF THE
ECONOMY, ITS REAL IMPACT IS EVEN GREATER. CROATIA’S TRAVEL &
TOURISM ECONOMY DIRECTLY AND INDIRECTLY ACCOUNTS FOR:
294,059
jobs __________________ representing 27.4 per cent of total Employment.
Kn
41,609.9
Kn
39,576.9
Kn
4,921.3
465.9
Kn
6
million (US$5,369.0 million) of GDP _______________ equivalent
to 22.4 per cent of total GDP.
million (US5,106.7 million) of Exports, Services & Merchandise ___
or 43.8 per cent of total Exports.
million (US$ 635.0 million) of Capital Investment __________________
or 11.1 per cent of total investment.
million (US$60.1 million) of Government Expenditures _____________________
or a 1.1 per cent share.
GROWTH
OVER THE NEXT TEN YEARS, CROATIA’S TRAVEL & TOURISM IS
EXPECTED TO ACHIEVE ANNUALIZED REAL GROWTH OF:
7.4%
3.7%
6.9%
7.3%
5.2%
4.5%
_____________in Travel & Tourism GDP, to Kn52,239.1 million (US$6,740.5 million) in
2013 for the industry directly and to Kn111,590.0 million (US$14,398.7 million)
for the Travel & Tourism Economy overall (direct and indirect expenditures).
__ in Travel & Tourism Employment, to 200,070 jobs directly in the industry, and 3.8% to
427,377 jobs in the Travel & Tourism Economy overall (direct and indirect) in 2013.
_________________________________________ in total Travel & Tourism Demand, to
Kn156,410.0 million (US$20,181.9 million) in 2013.
_______ in Visitor Exports, rising to Kn93,693.7 million (US$12,089.5 million) by 2013.
___________________________________ in terms of Capital Investment, increasing to
Kn10,635.3 million (US$1,372.3 million) in 2013.
______________________________________ in terms of Government Expenditures to
Kn944.3 million (US$121.8 million) in 2013.
FUTURE
PROSPECTS
THE BASELINE FORECASTS FOR CROATIA’S TRAVEL &
TOURISM ARE VERY POSITIVE. TRAVEL & TOURISM
DEMAND IS PROJECTED TO INCREASE BY 6.9 PER CENT
PER ANNUM OVER THE NEXT TEN YEARS.
This growth would exceed, by nearly 50 per cent, expected worldwide
growth of 4.5 per cent per annum and, by nearly 66 per cent, the 4.2 per
cent annual average growth projected for the European Union.
WTTC applauds the continued efforts of many of Croatia’s public and private sector
decision-makers towards ensuring a recovery of Travel & Tourism demand.
At the same time, WTTC believes strongly that more
new tourism satellite account (TSA), developed by
effective management of tourism growth, as well as
WTTC and Oxford Economic Forecasting for Croatia,
cooperation between all leading policy-makers and a
provides a significant tool for planning and policy
sustainable approach to Travel & Tourism development,
development. Updating this TSA on an annual basis will
can maximize the benefits and spread them to all parts
help to ensure that adequate data is available to factor
of the country and across all levels of the population.
Travel & Tourism into economic and employment
strategies. It also provides the National Tourist Board
TOURISM PLANNING
with hard economic data to raise awareness among
The new Croatian Tourism Strategy
2010, which is being developed by the
Croatian Strategic Development
Commission, McKinsey & Company
and the German Investment &
Development Company, should be
expedited swiftly and promoted widely.
public and private sector stakeholders of Travel &
Tourism’s full impact across the national economy – not
just on hotels, restaurants and retail business, but also on
construction, real estate, agriculture and other sectors.
INFRASTRUCTURE
new national targets and objectives, the strategy should
The expansion and renovation of
Croatia’s tour ism infrastructure,
particularly its hotel supply, is probably
one of the greatest challenges facing
the country’s tourism industry today.
initiate a more cohesive and cooperative approach to
This is also a critical competitive factor that could
future tourism development, involving all levels of
determine the growth of demand over the coming years.
government, the private sector and local communities.
According to the Croatian Ministry of Tourism, current
This will help guide the development of regional
plans, such as that of Istria, which is already underway.
While assessing performance to date and identifying
supply – particularly in the three- to five-star categories
8
MEASUREMENT
– is well below the level needed to meet current, let
Croatia’s economic and marketing
related Travel & Tourism research and
forecasting are still very inadequate,
both in terms of quality and quantity.
alone, future demand. Urgent investment is needed in
As a result, public sector analysis and related policies tend
proposed by the government should be implemented
to overlook or understate the impact of the industry, or
without delay, in order to stimulate both local and foreign
deal only with its smaller individual components. This
investment in quality infrastructure development.
this area to increase hotel bed capacity to the level
required to meet the projected growth in tourism
demand over the next ten years. Incentive schemes
INVESTMENT
share of major growth markets such as sun and beach,
Recognizing the power of international
brands to attract high yield markets and,
thereby, to stimulate wealth and job
creation, the government has opened
markets to internationally recognized
management companies, such as Sol
Meliá, Starwood and Hilton Hotels.
or marine/nautical tourism, Croatia has a fantastic
In terms of real-estate, property and development projects,
being targeted in the region of Istria. The MICE
challenges still remain that continue to hamper the
market is relatively untapped. Although it currently
attractiveness of Croatia for both domestic and foreign
represents a modest share of arrivals and overnights in
investment. Addressing these challenges should be seen
Croatia, it offers strong potential for growth, and it
as a high priority. Care should be taken to ensure
could help to address some of the seasonality problems
increased transparency in the privatization process, the
affecting the Croatian Travel & Tourism economy.
opportunity to develop innovative tourism products
and experiences, which would at the same time help
promote and protect its natural resources. Special
interest tourism, agricultural tourism, wine tours,
cultural holidays and adventure holidays provide
interesting examples of new products that are already
rapid resolution of land ownership issues and the
removal of red tape, as well as to ensure that fiscal
policies such as taxation are not harmful to investment.
TRANSPORT
The Croatian Government has
initiated several important transport
related infrastructure projects in
Croatia, which will benefit Travel &
Tourism and stimulate growth.
MARKETING &
PROMOTION
Experience has shown that demand
for any tourism destination grows
sharply if marketing and promotions
are well funded and effective.
A competitive, sustained promotional campaign is
critical for Croatia – not only to clarify and enhance
the country’s image in traditional and emerging source
These include the construction of one of the country’s
markets, but also to raise awareness of the importance
main highways between Zagreb and Split. However,
of Travel & Tourism to national and local economies
several other areas still require urgent attention. These
and the spin-off to all the different stakeholders. In
include roads linking major airports, such as the road
addition, effective marketing and promotions can help
between Split and Dubrovnik, which is already placed
prevent an excessive concentration of demand in time
under great strain by the diversion of airline passengers
and space, thereby ensuring that the benefits of Travel &
to Split airport when weather conditions are bad in
Tourism are spread more equitably.
Dubrovnik. Improved access is needed from local and
international markets to major and smaller towns, as
well as to the country’s numerous islands sorely in need
of economic development. A special task force should
be convened, comprising leading policy-makers at
national level, but also from the respective regions, to
find solutions to these urgent challenges.
ENVIRONMENTAL POLICY
Croatia has a major advantage over
many of its direct competitors – its
natural and cultural environment is
relatively unspoilt and offers huge
potential for sustainable tourism
development.
DIVERSIFICATION
Conveying environmentally and culturally friendly
The former Socialist political system
made it difficult for Croatia to remain
competitive as a tourism destination,
in terms of upgrading/expanding
infrastructure and diversifying
products and services.
policies, promoting voluntary accreditation schemes
At the same time, the lack of construction has helped
new tourism infrastructure to protect and promote
protect Croatia’s natural and cultural environments
the character of the local environment, developing
from excessive exploitation, giving the country a
authentic tourism products that are unique to the
unique competitive advantage. In addition to gaining
country and its culture.
for the industry, and outlining best practice in
tourism development, are all important steps that
need to be taken to protect Croatia’s main resources
from over-development and exploitation. At the
same time, Croatia can influence the development of
9
REALIZING
THE POTENTIAL
IN ORDER TO ACHIEVE OR – EVEN BETTER – SURPASS
THE BASELINE FORECASTS, AND TO ENSURE THAT
FUTURE GROWTH IS SUSTAINABLE, CERTAIN KEY
FACTORS NEED TO BE ASSURED.
These include a favourable government fiscal policy, a climate that is
conducive to business offering incentives for investment, and sustained and
effective marketing and promotion, as well as environmentally friendly
policies. Most importantly, clearly defined, long-term development plans
must be drawn up to help guide national and local public and private
sector activities.These plans should be developed in consultation with all
stakeholders, feeding from and back into the National Tourism Policy, and
they should be disseminated as widely as possible.
Against this background WTTC has made certain policy recommendations to the Croatian
Government, detailed in the report under the section entitled The Policy Framework.
These recommendations are summarized below:
PLAN FOR THE FUTURE.
■
Increase the responsibility of the Ministry of
well as to increase yield.
Expand and enhance the convention bureau’s efforts
Tourism, placing it among the highest levels of
■
government, and factoring the industry’s needs into
through the establishment of a National Convention
mainstream policies for employment, trade, investment,
Bureau (NCB) as a separate entity to the National
education and environmental protection.
Tourist Board, involving the NCB in the management
■
Expedite the completion of the new National
of all MICE business for Croatia.
Upgrade marketing and promotions to match
Tourism Policy, to replace the existing tourism strategy
■
of 1993, in consultation with regional and local
prevailing competitive approaches, and restructure the
governments and the private sector.
National Tourist Board as a public-private sector
■
Establish a dedicated research unit to monitor,
partnership, co-ordinating national, regional and
anticipate and adapt to changing trends in Travel &
municipal efforts.
Tourism demand.
■
■
Encourage
greater
market
and
product
diversification in order to reduce seasonality and an
Anticipate future investment needs by introducing
incentive schemes for investment from the private
sector – whether local or foreign.
unhealthy over-dependence on traditional markets, as
HIGHLIGHT THE STRATEGIC IMPORTANCE OF TRAVEL &
TOURISM.
■
Recognize Travel & Tourism’s impact across the
wider economy and its strategic importance as a catalyst
for other industries and entrepreneurial activity.
■
10
Measure the economic impact of Travel & Tourism
■
Convene an annual National Tourism Congress,
bringing together all Travel & Tourism stakeholders, to
discuss challenges and opportunities for the industry.
■
Reflect Travel & Tourism in mainstream policies for
by means of a tourism satellite account (TSA), updating
employment, trade, investment and education, ensuring
the TSA annually and communicating results to all
that the underlying policy framework is conducive to
levels of government, industry and local communities.
sustainable growth.
DEVELOP THE HUMAN CAPITAL REQUIRED FOR GROWTH.
■
Promote a positive image of the Travel & Tourism industry as a
provider of jobs and career opportunities for all Croatians.
■
Continue to place education and training at the forefront of Travel &
Tourism development, expanding it to all levels of the school curricula.
■
Ensure that formal education and vocational training systems adapt to
the rapidly changing human resource needs of the industry, covering a
variety of skills and customer service
■
Bridge the gap between education authorities and the industry, and
establish public-private sector liaison groups to plan ahead for the future
HR development needs of the industry.
ENCOURAGE OPEN MARKETS AND SKIES AND REMOVE BARRIERS TO GROWTH.
■
Progressively liberalize trade, transport and communications through
the World Trade Organization’s General Agreement on Trade in Services
and regional trading regimes.
■
Open up air transport markets and expand liberal aviation accords.
■
Continue to privatize state-owned tourism enterprises, extending
privatization from hotels to other sectors of the industry, including
transport.
■
Increase transparency in the privatization process and ensure that
long-term objectives for Travel & Tourism development.
■
Resolve land ownership issues between the state, private land owners
and the industry.
■
Reduce red tape and establish a stable legal framework, providing
protection of investments for potential investors.
■
Develop fiscal regimes that encourage tourism growth, exports
investment, infrastructure, business innovation and job creation.
■
Build safety and security provisions into national, regional and local
future efforts are undertaken in close cooperation with the Ministry of
strategies and place special emphasis on Travel & Tourism in overall
Tourism, keeping decisions and procedures within the overall vision and
policing strategies.
MATCH PUBLIC AND PRIVATE INFRASTRUCTURE TO CUSTOMER DEMAND.
■
Expand infrastructure, including airports, to anticipate projected
■
Develop new conference/congress facilities to meet the growing
demand and improve road networks, improving links between airports
demand for this high yield sector.
across the country, and opening up new areas for tourism development.
■
■
Invest in the expansion and modernization of seaports, marinas and
Improve land use planning and protection, guarding against
uncontrolled real-estate development that poses a threat to the image
other transport connections between the mainland and islands of
and quality of Croatia as a destination.
Croatia, opening up these areas for economic development.
■
■
Introduce special incentives for the rapid modernization of Croatia’s
Introduce timely incentive schemes to attract sustained capital
investment from both domestic and foreign sources.
hotel accommodation infrastructure.
FAVOUR TECHNOLOGICAL ADVANCEMENT.
■
Make Travel & Tourism a priority in helping to introduce and apply
■
Develop a national tourism database together with partners from the
IT systems and telecommunications at a competitive pace across the
private sector, so as to improve the distribution of Croatia’s products –
country.
both through the travel trade and direct to consumers – as well as to
■
Take the lead in promoting the use of technology and developing e-
enhance Croatia’s image in key markets.
marketing skills in Travel & Tourism to achieve greater efficiencies and
effectiveness.
PROMOTE RESPONSIBILITY IN NATURAL, SOCIAL AND CULTURAL
ENVIRONMENTS.
■
Establish clear policies and guidelines for planned and sustainable
tourism expansion.
■
Anticipate and plan ahead regarding the development of consumption,
■
Ensure that the socio-economic, cultural and environmental benefits
of Travel & Tourism are spread equitably across the population in all parts
of the country, and recognize the need for local community engagement
waste and resource utilization, in order to meet the projected growth in
and empowerment.
Travel & Tourism demand while protecting natural resources.
■
Develop and promote a national heritage designation with clearly
Promote the sustainable development of Travel & Tourism as a policy
defined criteria to support quality. Accompany this with increased
across the entire industry/country, not just as a policy for rural and
government funding for the development and promotion of identified
nature-based tourism.
areas of particular heritage value, focusing on national and international
■
■
Introduce pilot projects to evaluate and demonstrate local
designations.
sustainability.
11
CROATIA’S
TRAVEL & TOURISM
OVERVIEW OF RECENT TRENDS AND DEVELOPMENTS
This section of the report has been compiled with the generous support of Barcelona-based THR International Tourism Consultancy.
RETURN TO GROWTH AFTER A
DECADE OF DECLINE
Graz
AUSTRIA
Maribor
Croatia’s Travel & Tourism industry started to develop in the early 1960s
and, for the next 25 years or so, the country became an increasingly
ITALY
Ljubljana
Pécs
SLOVENIA
important player in the Mediterranean sun & beach market. By the
1980s, Croatia was an established holiday destination, representing
HUNGARY
Zagreb
Trieste
Osijek
CROATIA
Rijeka
serious competition for the Mediterranean leaders such as Spain, Italy,
France and Greece. The primary reasons for its success were its natural
natural environment – the warmth and friendliness of the local people,
Tuzla
and the fact that it offered excellent value for money.
A
D
Ancona
Split
I A
to adapt to changing shifts in the marketplace. While competing
Sarajevo
R
product nonetheless started to slow as a result of the country’s inability
BOSNIA and HERZEGOVINA
Zadar
In the mid-1980s, the growth in demand for Croatia’s tourism
SERBIA
geographic attractions – notably its beautiful coastline and unspoilt,
T
Gorazde
Mostar
I C
destinations began to adjust their products and services to meet the
increasingly sophisticated and quality-conscious European tourists, the
S
ability of the Croatian tourism industry to keep up with the rapid
changes in demand was severely hampered by the Socialist system
E
A
Dubrovnik
Podgorica
governing the country at that time.
ITALY
Shkodër
The devastation of war
During the 1990s, Croatia suffered the devastating impact of political
arrivals in 2002, to 8.3 million, following a 19 per cent growth the
instability and war on Travel & Tourism demand, as well as on the
previous year. International business was reportedly stronger in terms of
destination’s tourism infrastructure and supply. Rebuilding Croatia’s
growth than the domestic market with several markets, including the
tourism industry since the end of the war has not been easy – and the
UK, recording a second year of double-digit growth. This means that
country is still a long way from realizing its tourism potential.
arrivals ended 2002 at 86 per cent of Croatia’s 1989 peak.
Most importantly, perhaps, as a result of its inadequate
Overnight volume has not risen as sharply, but growth has been
infrastructure, it has rapidly regained the image of a destination
well above the world and Mediterranean averages for the last few years.
primarily targeting the lower end of the holiday market. Yet for
Total overnights rose by an estimated 3 per cent in 2002 and by 13 per
independent travellers – especially those staying in hotels – it is actually
cent in 2001, but are still at only 72 per cent of their peak.
quite expensive in comparison with some other Mediterranean
destinations, as WTTC’s Competitiveness Monitor shows.
Nevertheless, there are a number of positive signs auguring well for
the future of Croatia’s tourism industry. The Croatian Government
The slower growth in overnight volume is the result of a declining
average length of stay, itself due to a trend towards shorter summer
holidays – one week instead of two – but also to an increase in short
breaks.
recognizes the potential of Travel & Tourism to contribute to the
With Turkey and Bulgaria, Croatia was one of the best performing
country’s economic revival, as well as encouraging social and cultural
destinations, in terms of percentage growth, in the European summer
cohesion within the country, and it has taken steps to implement
holiday market last year.And its current level of growth is expected to be
measures to facilitate Travel & Tourism growth.As detailed in the Policy
sustained during 2003.The events of September 11, 2001, uncertainty in
Recommendations of this report, there is still a lot to be done, but
the Middle East, and a slow economic recovery have led to increased
recovery is now well on track – at least in terms of numbers’ growth.
price sensitivity among many of Europe’s key source markets, notably
Preliminary estimates point to a 6 per cent increase in total tourist
Germany. This has boosted demand for the eastern Mediterranean.
13
while the least developed areas – despite their potential – are located in
Croatia on the Road to Recovery, 1989-2000
the southern Dalmatia region.
70,000
7
x
60,000
x
Traditional towns and villages
6
x
x
x
5
40,000
4
30,000
3
20,000
2
10,000
1
NUMBER OF NIGHTS
50,000
There are literally hundreds of cities, towns and villages – primarily
along the Adriatic coast – that can provide tourists with basic
accommodation and board, as well as a limited supply of sporting
activities, entertainment, sightseeing and shopping. In addition to the
old coastal towns of interest, such as Porec, Rovinj, Korcula,Trogir and
Hvar, Croatia boasts a large number of little villages, which have
preserved their historical character and traditions.And the hinterland of
0
1989
1998
2000
Tourist arrivals ('000)
2001
x
Overnights ('000)
2002a
0
Average length
of stay (nights)
aPreliminary estimates
Note: Since 2001 tourism data has included statistics on marine/nautical tourism
Sources:THR based on statistics from Croatia’s Central
Bureau of Statistics (CCBS); Ministry of Tourism for 2002 data
Croatia offers much more than just the capital city of Zagreb, boasting
dozens of medieval fortresses, castles and mansions.
The coast enjoys a typical Mediterranean climate with hot, dry
summers and mild, humid winters, while the mountainous region can
actually be quite cold in winter, with a lot of snow.
Despite the country’s huge potential for tourism development, the
number and type of attractions and activities – beyond pure sun &
beach relaxation – are limited. There are very few facilities for golf,
health and wellness, or special interest activities, for example.
The challenge now is to create and promote new competitive
Developing these segments would undoubtedly help to extend the
advantages – in addition to its price attraction for package tourists – so that
current tourist season – May to September – and to increase tourism
it further diversifies its markets and improves visitor expenditure and yield.
expenditure.
Diverse historical and cultural attractions
A RICH NATURAL AND CULTURAL
HERITAGE
Nevertheless, the country also has a rich cultural heritage, including
Islands in pristine waters
Baroque periods, and Art Nouveau cities such as Opatija. A rich variety
Croatia enjoys a unique geographic landscape, with more than 1,000
of different cultural events are organized throughout the year, and some
islands set in pristine waters of the highest quality and clarity.A number
of these attract international visitors from far and wide. These include
of these have been grouped together as national parks. The country
music festivals, Klape singing festivals, carnivals, tennis tournaments,
boasts some of the most attractive coastline in the Mediterranean
sailing regattas and motorcycle races. Central Croatia and Slavonia display
region, much of which is unspoilt, as well as lowlands and highlands
the strongest Middle European influences in their architecture and
culminating in the mountainous region of Lika and Gorski Kotar.
folklore.
archaeological sites dating from the Roman, Gothic, Renaissance and
Bordered to the north/northwest by Slovenia, Hungary to the
north/northeast, Bosnia & Herzegovina to the southeast, Serbia to the
east and Montenegro to the south, Croatia’s 5,835 kilometre long
coastline hugs the Adriatic from north to south. In terms of size, the
country is comparable to Denmark, Ireland or Slovakia, with a land
surface area of 56,500 square kilometres. Its 4.4 million population, on
the other hand, gives it a population density similar to that of Spain or
A strategic location
The country’s cultural and historical traditions have been maintained
thanks, in part, to its strategic location at the crossroads of Europe. No
fewer than ten of Europe’s key international land routes and railway
links – including the historic Europe to Asia route – pass through
Croatia. Numerous passenger and cargo ports are located along the
coast, which is also home to nine international airports.
Greece (85 inhabitants per square kilometre).
Croatia has three distinctive geographical and climatic regions –
the Pannonian and Peripanonian mainland, mountains and coastal
region – and four distinctive functional areas around four major
TRAVEL & TOURISM TRENDS
Croatian cities: Zagreb – the capital – Osijek, Rijeka and Split.
Detailed results are not yet available for 2002 but, as already indicated,
While Dubrovnik, known as the ‘Pearl of the Adriatic’, is
Croatia recorded a 6 per cent increase in tourist arrivals last year, to 8.3
considered to be Croatia’s main – as well as internationally acclaimed –
million, and a 3 per cent rise in overnights, to 44.7 million.The major
tourist attraction, the country offers enormous potential for
sources, in terms of arrivals, were: Germany, Croatia (the domestic
development, boasting numerous cultural and natural sites. The most
market), Italy, Slovenia, the Czech Republic and Austria.
developed Travel & Tourism region is Istria, in the north of the country,
14
Last year's healthy performance follows an excellent 2001, during
which foreign arrivals grew by 23 per cent and overnights from abroad
Major international markets
were up more than 30 per cent.The foreign arrivals count increased by
Germany has maintained its position as international market leader
6 per cent in 2002 and overnights rose by 3.5 per cent. The increase
since the late 1980s, generating close to an 18 per cent share of total
in domestic arrivals, by comparison, was more modest at 4.5 per cent,
arrivals and a 24 per cent share of nights in 2002. This compares with
and domestic overnights actually declined by just under 1.0 per cent.
19 per cent and 25 per cent respectively in 1989, the country's peak
International markets account for some 83.5 per cent of total
tourism year. Germans also generate the longest average length of stay
arrivals and an even higher 89.0 pert cent of nights, reflecting the
in Croatia – 7.3 nights in 2002 as against an average of 5.7 per cent for
shorter holiday trips taken by Croatians.
foreign markets, and just 4.4 nights for Italians, in second position in the
ranking.This highlights the Italians' greater propensity for cross-border,
Tourist Arrivals in Croatia by Major Markets,
1989 and 2001-2002
short-break travel to Croatia.
In third and fourth positions are Slovenia and the Czech Republic,
two former east European countries that have become important
UK
sources of tourism business.
Netherlands
The country also enjoys a relatively significant market share in four
Bosnia &
Herzegovina
other markets: Austria (11 per cent), Poland (6 per cent), Italy (5 per
cent) and Hungary (4 per cent). In most major markets, however, its
Hungary
share tends to be under 2 per cent.
As a result of the Balkan war, two former domestic Yugoslav
Poland
markets that used to be important sources of tourism – now Bosnia
Austria
& Herzegovina and Serbia & Montenegro – have shrunk
Czech
Republic
significantly in size.
Slovenia
Seasonality of demand
Croatian tourism is characterized by high seasonality of demand. The
Italy
four months of June through August account for as much as 88 per cent
Germany
of total overnight volume and 78 per cent of arrivals.The peak summer
season – just the two months of July and August – generate more than
Domestic
0
200
1989
400
600
2001
800 1,000 1,200 1,400 1,600 1,800 2,000
Arrivals ('000)
2002
Source: CCBS
65 per cent of all overnights and 54 per cent of arrivals.
The winter months of October through March, in contrast,
account for a modest 5 per cent of nights and 11 per cent of arrivals.
Average length of stay during these months falls to a low of 2.3 nights
in November, with October generating the highest monthly average
Tourist Overnights in Croatia by Major Markets,
1989 and 2001-2002
during the winter, of 3.5 nights. Average length of stay during July and
August, by comparison, is 6.7 and 7.3 nights respectively.
UK
Bosnia &
Herzegovina
Tourist Arrivals and Overnights in Croatia by Month
Netherlands
14,000,000
Hungary
z
Poland
12,000,000
Austria
10,000,000
Czech
Republic
8,000,000
Italy
6,000,000
z
z
Slovenia
z
4,000,000
Germany
2,000,000
Domestic
0
0
2,000
1989
4,000
2001
6,000 8,000 10,000 12,000 14,000 16,000
Overnights ('000)
2002
z
x
x
x
x
x z
z
x z
x
x
x z
x z
x z
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
z
Source: CCBS
z
x
Nights
x
Arrivals
Source: CCBS
15
Organization of travel to Croatia
connections between the islands as well as with fast transfers between
The low average stay is partly explained by the fact that two thirds (66 per
central/east European and west European countries.
cent) of all tourists visiting Croatia organize their trips independently,
The Croatian Railways are not seen as an attraction for the tourism
while just one third (34 per cent) are either on fully or partly packaged
industry at this time. Due to very low cargo and passenger traffic, more
holidays, booked through tour operators and/or travel agencies.
time and much investment will be needed to modernize the railways
This share is below the level of tour operator packages reached in the
and adapt the product to the needs of tourists.
1980s, before the outbreak of the Balkan war. Nevertheless, the majority
of German tourists to Croatia have always opted for car travel, with many
Repeat visitation
staying in campsites at the destination, since this sector of the market is
Interestingly, almost 64 per cent of foreign visitors to Croatia have
extremely price conscious. It has only been in the last couple of years that
already visited the country at least twice before. Some 17 per cent are on
tour operators have succeeded in offering an all-in price that makes air
their second trip and 19 per cent are visiting the country for the first time.
package travel attractive.
The Internet’s share of total bookings is reportedly very low,
Frequency of Foreign Visits to Croatia
although it can be expected to rise sharply – with tour operator websites
generating most interest in the foreseeable future.
Transport
First visit
19.0%
The high share of private car-based travel to Croatia (69 per cent) is
another indication as to the continuing importance of independent
travel to the destination. If cars plus caravans and camping vans are
included, the share rises to 82.5 per cent.
Three or more visits
63.8%
Second visit
17.2%
Despite the huge growth in sales of air package holidays to Croatia,
air travel – scheduled and charter flights combined – accounts for less
than 4 per cent of all arrivals.
Breakdown of Arrivals in Croatia by Transport Used, 2001
Source:TOMAS 2001
Train 0.4%
Rented vehicle 0.4%
Ship/ferry/boat 0.9%
Motorbike/bicycle 1.1%
Scheduled flight 1.7%
Charter flight 2.1%
Camper van 4.0%
Domestic tourism
In 2001, domestic tourism accounted for 17 per cent of arrivals and 12
per cent total overnights in Croatia – virtually unchanged from its
shares in the peak tourism year of 1989. Although the market is
Private car
68.7%
Car/caravan
9.9%
expected to show sustained positive growth in the future, it is not seen
as a dynamic source in the short term.
Domestic tourists stay mainly in hotels, generating an estimated 37
Bus/coach
10.8%
per cent of hotel bednight volume, but holiday villages and campsites
also attract fairly significant shares.
Source:TOMAS 2001, Institute for Tourism, Zagreb
STRENGTHS AND WEAKNESSES OF
CROATIA’S TOURISM PRODUCT
Research conducted in June 2001 by the Barcelona-based THR
Despite this, Croatia has nine international airports, four of which
International Tourism Consultancy, involving 70 leading tour operators,
are located on the coast – Pula, Zadar, Split and Dubrovnik. Three are
highlights the most competitive features of Croatia’s tourism product –
on the islands – Krk near Rijeka and the islands of Losinj and Braè –
in the eyes of tour operators packaging programmes to the destination.
and two are in the central plain (Zagreb and Osijek).There are plans for
Unsurprisingly, these are the beauty of its coast and islands; clean and
new airports to be built on other islands.
clear seawater; and a warm, sunny climate.
The country also has six international seaports – Pula, Rijeka,
This research is substantiated by the results of the TOMAS survey
Zadar, Split, Ploèe and Dubrovnik – and dozens of small ports of local
carried out in 2001, which indicates the main reasons for visiting
and regional importance. However, there are some problems with sea
Croatia. As many as 91 per cent cited rest and relaxation by the seaside.
16
ACCOMMODATION
Main Reasons for Visiting Croatia
% share of responses
Croatia currently has a total of 722,525 beds and camping places in
Rest & relaxation by the seaside
91.1
different types of tourist accommodation for tourists, as well as
Pleasure & fun
36.1
numerous guesthouses with private rooms, plus rooms in aparthotels,
Visiting natural attractions
32.5
motels, hostels, spas, etc.
New experiences
20.2
Reason
Proximity of destination
9.8
Visiting cultural attractions
7.5
Sport, recreation & fitness
7.1
Affordable prices
6.5
Visiting friends and/or relations
6.2
Health reasons
4.3
Scuba diving
3.1
Business
1.1
Shopping
0.6
Other
1.6
Breakdown of Bed Capacity in Croatia by
Type of Accommodation, 2001
Holiday villages/apartments 8%
Aparthotels,
motels,
hostels, etc 11%
Private
accommodation
44%
Hotels
13%
Note: Multiple answers possible
Source:TOMAS 2001
At the same time, the THR research suggests that tourists from
Campsites
24%
each of Croatia’s main tourism generating markets are influenced by
different competitive factors when opting for Croatia as their choice of
holiday destination.These are:
■
Austria: the richness of nature
■
Czech Republic: the absence of language barriers
■
Germany: close proximity and price competitiveness
The hotel sector
■
Italy: price competitiveness
However, according to data from the Central Bureau of Statistics, there
■
Poland: nature and hospitality
■
USA: culture and history, peace and relaxation
Note:Total no. of beds and camping spaces = 722,525
Source:THR from the Ministry of Tourism
are actually 419 hotels in the country with a total of 49,380 rooms.
Only 34 properties – or 6,286 rooms – are located in four- and five-star
hotels.
THR’s research also shows that each of Croatia’s regions offers
specific attractions in the eyes of international and domestic visitors
Accommodation Supply in Croatia by Star Category, 2002
taking holidays in the country:
■
Istria: sun & beach holidays, touring, marine/nautical holidays,
Category
Number
No. of
Rooms
1,931
5* hotels
10
culture and sports
4* hotels
24
4,355
■
Kvarner: sun & beach holidays, naturism
3* hotels
170
23,939
■
Zadar: sun & beach holidays, marine/nautical holidays, touring
2* hotels
178
16,989
1* hotels
37
2,166
■
Sibenik: sun & beach holidays, marine/nautical holidays, touring
419
49,380
■
Split-Makarska: sun and beach holidays, nautical holidays, touring
and culture
■
Dubrovnik: combination of sun & beach holidays and culture
■
City of Zagreb: culture
■
Central Croatia: touring and naturism
■
Slavonia: natural environment and touring
Hotels, total
4* villas
1
10
Villas, total
1
10
4* aparthotels
1
21
3* aparthotels
4
144
2* aparthotels
3
68
Aparthotels, total
8
233
428
49,623
Total
Source: CCBS
According to the THR tour operator research, Croatia’s main
About one third of total accommodation capacity conforms to
competitors are Spain, Italy, Turkey and Greece. Other competitors
international industry standards, while one third is at the lower limit of
include France and Tunisia while Austria, Bulgaria, the Czech Republic,
what is acceptable, and the remaining one third is well below
Germany, Malta, Poland, Romania and Slovenia also compete with
international norms and badly in need of major renovation.
Croatia for international visitors, albeit to a lesser extent.
The hotel sector is the one that is suffering most from damaged and
17
ageing bedstock. In fact, the expansion and renovation of Croatia’s hotel
supply is probably one of the greatest challenges facing the country’s
Tourist Overnights in Croatia by Type of Accommodation,
1989 and 2001
tourism industry – not to mention a critical competitive factor that could
determine the growth of demand over the coming years.
25,000
One big disadvantage is that there are few, well-known
international hotel brands operating the country. Sheraton, Starwood
20,000
(Westin and Four Points), Sol Meliá, Club Méditerranée, Iberostar and
Riu already have a presence in Croatia and a Hilton International
15,000
property is scheduled to open in Dubrovnik before the end of the year.
In addition, a number of international hotel groups have expressed
10,000
interest in establishing a presence in Zagreb, as well as in key resort
locations, and local developers are looking to sign agreements with
5,000
international operators for properties under construction.
Several, as yet unbranded, resort projects are under construction, or
0
Hotel
on the drawing board.These include the conversion of a former 5,000-
Holiday village Campsite Private room
1989 ('000)
Other
2001 ('000)
bed, mass-market tourist complex in the south of the country, which is
being funded by an unnamed German investor. This will become a
Note: 2001 data includes statistics on marine/nautical tourism
Source: CCBS
2,500-bed four- to five-star resort including a port that is a potential
harbour for cruise ships visiting Dubrovnik. Other projects include a
tourist complex in Prapatno on the Peljesac peninsula.
Existing local hotel operators tend to be reminiscent of former,
state-owned, locally managed enterprises. In some locations these
companies have been more or less successfully privatized and operate to
international standards. In most places, however, this is not the case, so
FUTURE PROSPECTS
The prospects for Croatia’s Travel & Tourism growth are good, but it
might not be easy to shake off the image it currently has of being a lowcost destination. It would be a pity if would-be tourists – not to
mention investors – underestimated the destination’s potential in terms
the hotels leave a lot to be desired.
of quality products.
In fact, Croatia has all the necessary natural resources on which to
build the new tourism products required by the new, quality-conscious
Hotel operating performance
Data compiled by Horwath Consulting Zagreb for its latest available
annual survey on Croatian hotels suggests that the average occupancy of
leading hotels in 2001 was 42 per cent – around ten points above the
country-wide average – and the average daily room rate was €35.50.
The hotels achieved a gross operating profit of 22 per cent.
Hotels generated 34 per cent of total overnights spent in Croatia in
2001 as against 35 per cent in 1989. In fact, the respective shares of the
different types of accommodation in terms of tourist overnights have
and increasingly sophisticated consumer. Even though there will always
be a need to provide low-cost tourism for those who cannot afford
anything else, diversification would ensure the sustainable growth of the
industry for the benefit of all stakeholders.
As the international market becomes increasingly aware of the
environmental friendliness of Croatia, as well as the unique attractions
of destinations such as the Plitvice Lakes, this should encourage further
tourism growth. It should also help Croatia to clarify its image generally.
changed relatively little in the last 12 years. Camping is still the second
favourite form of accommodation, followed by accommodation in
private rooms.
The prospects for Croatia’s Travel &
Operating Results of Leading Hotels in Croatia, 2000
Average size of hotel (no. of rooms)
22.9
Average age of hotel (years)
32.4
Tourism growth are good, but it might
not be easy to shake off the image it
Average no. of employees per room
0.5
currently has of being a low-cost
Average annual room occupancy (%)
42.3a
destination. It would be a pity if would-be
Average daily room rate (€)
35.50
Total revenue per available room (€)
Gross operating profit (%)
9,430.00
21.7
tourists – not to mention investors –
underestimated the destination’s potential
a Around 10 points above industry average
Source: Croatia Hotel Survey 2001, Horwath Consulting Zagreb
18
in terms of quality products.
TRAVEL & TOURISM
SATELLITE ACCOUNT
TOURISM SATELLITE ACCOUNTING
THIS REPORT FOLLOWS THE CONCEPT OF SATELLITE ACCOUNTING
DEFINED IN THE TOURISM SATELLITE ACCOUNT: RECOMMENDED
METHODOLOGICAL FRAMEWORK (TSA:RMF), AND DEVELOPED UNDER
THE AUSPICES OF THE WORLD TOURISM ORGANIZATION.
Over the last three decades, countries have estimated the economic impact of Travel & Tourism through a range of
measures using a variety of definitions and methodologies. Such approaches have prevented meaningful comparisons
among nations. Even for the same nation over different periods of time, they have frustrated business and
government attempts to draw valid conclusions about the nature and course of Travel & Tourism demand in national
economies.This regime has obscured the substantial, positive role the industry plays in national economies and has
thwarted business and government attempts to optimize economic programmes and policies.
The World Travel & Tourism Council (WTTC) recognized the dearth of crucial Travel & Tourism intelligence
from the time of its establishment in 1990 and it published the first detailed estimates of world tourism’s economic
impact that same year.
Since then WTTC has worked to improve its methodologies and to encourage individual countries to enhance
their measurement and understanding of tourism’s impact on their national economies. Furthermore, in the spirit
of joining forces to enhance world comprehension of the role of Travel & Tourism in national economies,WTTC
has strongly supported the programmes of the World Tourism Organization (WTO) to improve tourism statistics
worldwide.
WTTC’S RESEARCH
WTTC and its economic/research partners – Oxford Economic Forecasting, (OEF), since 1999, and Global Insight
(previously known as DRI•WEFA), from 1990-1999, have developed and published research on the economic
contribution of Travel & Tourism to the world, regional and national economies.
Starting in 1990,WTTC’s research team has been working to develop practical, real-world models to illustrate
Travel & Tourism’s economic contribution based on the needs of private sector leaders, public sector policy-makers
and industry researchers, and on the interpretation of the system of national accounts. The research is now firmly
anchored in the international standard for tourism satellite accounting that was developed by WTO, OECD and
Eurostat, and approved by the United Nations Statistical Commission in 2000. It was launched at the TSA
Conference held in Vancouver in May 2001 and published as the Tourism Satellite Account: Recommended Methodological
Framework (TSA:RMF) in 2001.
Since 1999, WTTC’s research has assumed the conceptual framework of the UN-approved standard with a
number of discretionary extensions, and it combines the most sophisticated economic modelling and forecasts available
with the most up-to-date, publicly available data to generate a comprehensive implementation of Travel & Tourism
satellite accounting.
This special simulated TSA for Croatia is the product of work commissioned by the Croatian Bureau of
Statistics working in cooperation with the Croatian Ministry of Tourism. In carrying out the work, OEF has drawn
extensively on the methodology developed over the years by WTTC to develop TSAs as operational tools, and has
worked closely with the Croatian Bureau of Statistics and its project steering committee to review the assumptions,
models and results produced by this excercise.
20
WTTC’S APPROACH TO TOURISM SATELLITE ACCOUNTING
WTTC has endeavoured to implement and produce
the growth of businesses that help alleviate trade
the most comprehensive TSA provided for within the
balance issues;
TSA:RMF – by developing the narrow concept of the
■
Demand- and supply-side information on
‘Travel & Tourism Industry’ in addition to the broader
employment that allows for human resource
concept of the ‘Travel & Tourism Economy’. WTTC
planning and development.
advocates full implementation of the TSA as defined in
WTTC has worked towards developing a
the TSA:RMF in order to achieve the highest level of
comprehensive TSA – not because it is eager to
benefits for industry and governments.These include:
exaggerate the size of Travel & Tourism’s impact, but
■
■
A wealth of customer and consumer information on
because the information that can be garnered from the
tourism-related purchases (before, during and after
exercise by governments and industry is crucial for
trips – whether domestic or international, imported
making intelligent and informed policy and business
or exported – as well as services, durables and non-
decisions. WTTC believes that history will document
durables) that has never been identified until now;
its pioneering implementation of the simulated TSA as
Comprehensive documentation and analysis of
one of the most important turning points for Travel &
the full tourism-product service chain and
Tourism’s long overdue economic recognition.
government’s ability to deliver quality and timely
■
■
■
In the WTTC research, no country receives special
service to visitors;
treatment or favours. WTTC uses internationally
Linkages between Travel & Tourism and other
available data sources and the same scope of tourism
sectors of the economy such as agriculture and
satellite accounting for all countries, as well as the same
manufacturing to illustrate the flow-through of
basic assumptions through the same system of models.
spending;
WTTC’s TSA research utilizes a universal and internally
Complete outlook for public works that benefit
consistent
visitors and Travel & Tourism companies in order
harmonized results and forecasts for 161 countries
to leverage public sector plans and priorities for
around the world. Details of the methodology used by
growth;
WTTC/OEF in its TSA research are available on
Focused opportunities for domestic production, as
WTTC’s website (www.wttc.org).
modelling
framework
and
generates
well as incentives from the public sector, to aid in
CROATIA
Travel & Tourism Employment
(‘000 Jobs)
Travel & Tourism Gross Domestic Product
(1990 Constant US$ mn)
8,000
400
Economy
Economy
Industry
Industry
6,000
300
4,000
200
T&T ECONOMY
Direct and indirect impact of visitor activities, capital
investment, exports and government services.
100
2,000
T&T INDUSTRY
0
1999
2000
2001
2002
2003
2004
Direct impact of visitor activity (transportation,
accommodation, food and beverage, recreation,
entertainment and travel services)
0
1999
2000
2001
2002
2003
2004
21
TSA CONCEPTS
& STRUCTURE
Year 2003 (US$ mn, ’000 Jobs)
Personal Travel
& Tourism
Business Travel
1457.6
Government
Expenditures
(Individual)
466.8
Visitor
Exports
Government
Expenditures
(Collective)
3,951.3
5.3
41.1
Capital
Investment
Exports
(Non-Visitor)
609.9
455.5
Travel & Tourism Consumption
5,881.0
Travel & Tourism Demand
6,987.5
Travel & Tourism Industry Supply
Travel & Tourism Economy Supply (Residual)
5,881.0
1,106.5
Imports
Travel & Tourism Industry GDP
(Direct Only)
2,093.9
2,182.0
Comp.
Indirect
Taxes
985.0
T&T Industry
Employment
128.8
310.2
Travel & Tourism Economy Supply
T&T Industry GDP (Indirect)
1,605.1
Operating
Surplus Subsidies
330.6
Depreciation
6,987.5
Travel & Tourism Economy GDP
(Direct and Indirect)
Imports
4,645.2
322.6
T&T
Economy
Employment
2,342.3
Property
Taxes
275.3
Personal
Income Taxes
141.2
Indirect
Taxes
950.5
Other
Taxes
13.9
Travel & Tourism Taxes
1,105.5
22
Travel & Tourism Satellite Accounting research for Croatia reflects
made on behalf of the community at large, such as tourism
a comprehensive simulation of the new international standard
promotion, aviation administration, security services and resort
adopted by the United Nations following the Enzo Paci World
area sanitation services.
Conference on the Economic Impact of Tourism (Nice, France,
• Capital Investment by Travel & Tourism providers (the private
June 1999), ten years of model development and TSA experience by
sector) and government agencies (the public sector) to provide
WTTC and Oxford Economic Forecasting (OEF), and application of
facilities, equipment and infrastructure to visitors.
• Exports (Non-Visitor) which include consumer goods sent
OEF’s latest macro-economic forecasts.
abroad for ultimate sale to visitors (such as clothing, electronics
TSA Economic Concepts
or petrol) or capital goods sent abroad for use by industry service
The Travel & Tourism Satellite Account is based on a ‘demand-side’
providers (such as aircraft or cruise ships).
concept of economic activity, because the industry does not produce or
By employing input/output modelling separately to these two
supply a homogeneous product or service like traditional industries
aggregates (Travel & Tourism Consumption and Travel & Tourism
(agriculture, electronics, steel, etc). Instead, Travel & Tourism is an
Demand), the Satellite Account is able to produce two different and
industrial activity defined by the diverse collection of products (durables
complementary aggregates of Travel & Tourism Supply: the Travel &
and non-durables) and services (transportation, accommodations, food and
Tourism Industry and the Travel & Tourism Economy.The former
beverage, entertainment, government services, etc) that are delivered to
captures the explicitly defined production-side ‘industry’ equivalent,
visitors.There are two basic aggregates of demand in the TSA:
direct impact only, for comparison with all other industries, while the
I
Travel & Tourism Consumption represents the value of
latter captures the broader ‘economy-wide’ impact, direct and indirect, of
products and services that have been consumed by visitors. It is the
Travel & Tourism.Through this process, the Satellite Account is also able
basic demand-side aggregate used to construct an explicitly defined
to determine that portion of supply, which it Imports from abroad.
Next, the satellite account breaks down both aggregates of supply
production-side ‘industry’ equivalent for comparison with all other
industries.Travel & Tourism Consumption includes:
(Industry and Economy) into the direct and indirect impacts of Gross
• Personal Travel & Tourism, more formally known as consumer
Domestic Product (GDP), the main descriptor of economic
expenditures, which captures spending by Croatia’s residents on
production, as well as the various components of GDP (Wages &
traditional Travel & Tourism services (lodging, transportation,
Salaries, Indirect/Transaction Taxes, Operating Surplus,
entertainment, meals, financial services, etc) and goods (durable
Depreciation and Subsidies). Beyond the regular TSA accounts, a
and nondurable) used for Travel & Tourism activities.
separate analysis is also provided of Personal Income Taxes paid by
• Business Travel by government and industry, which mirrors
Personal Travel & Tourism’s spending on goods and services
Property Taxes paid by Travel & Tourism companies.
(transportation, accommodation, meals, entertainment, etc), but
Finally, one of the most important elements of the Travel & Tourism
represents intermediate inputs used in the course of business or
Satellite Account are the Employment results, which can now be
government work.
quantified for the basic Travel & Tourism Industry and the broader
• Government Expenditures (Individual) by agencies and
departments which provide visitor services such as cultural (art
Travel & Tourism Economy.
•
T&T Industry Employment generally includes those jobs with
museums), recreational (national park) or clearance (immigration/
face-to-face contact with visitors (airlines, hotels, car rental,
customs) to individual visitors.
restaurant, retail, entertainment, etc).
• Visitor Exports, which include spending by international
visitors on goods and services.
II
Travel & Tourism generated employment and Corporate and
Travel & Tourism Demand builds on Travel & Tourism
consumption to include Travel & Tourism products and services
associated with residual components of final demand. It is used to
construct a broader ‘economy-wide’ impact of Travel & Tourism.
The residual elements of Travel & Tourism demand are:
• Government Expenditures (Collective) made by agencies
•
T&T
Economy
Employment includes T&T Industry
Employment plus those faceless jobs associated with:
• Industry suppliers (airline caterers, laundry services, food
suppliers, wholesalers, accounting firms, etc).
• Government agencies, manufacturing and construction of capital
goods and exported goods used in Travel & Tourism.
• Supplied commodities (steel producers, lumber, oil production,
etc).
and departments associated with Travel & Tourism, but generally
23
TRAVEL & TOURISM’S
ECONOMIC IMPACT
TRAVEL & TOURISM – ENCOMPASSING TRANSPORT,ACCOMMODATION,
CATERING, RECREATION AND SERVICES FOR VISITORS – IS ONE OF
CROATIA’S HIGHEST PRIORITY INDUSTRIES AND EMPLOYERS.
Worldwide in 2003, it is expected to post US$4.6 trillion of economic
estimated at 294,100 jobs, or 27.4 per cent of total employment. By
activity (Total Demand), growing to US$8.9 trillion by 2013.
2013, the number of jobs should grow to 427,400 – 33.9 per cent of
Travel & Tourism Total Demand in the European Union is expected to
total US$1.5 trillion in 2003, growing to US$2.8 trillion in 2013.
In Croatia, in 2003,Travel & Tourism is expected to post Kn61.5 billion
(US$7.9 billion) of economic activity (Total Demand), growing to
Kn156.4 billion (US$20.2 billion) by 2013.
In 2003, the Travel & Tourism Industry should contribute 3.7 per cent
to worldwide GDP. The broader Travel & Tourism Economy should
contribute 10.2 per cent to world GDP in 2003.
total employment. The 139,000 Travel & Tourism Industry jobs will
account for 13.0 per cent of total employment in 2003 and are forecast
to rise to 200,100 jobs, or 15.9 per cent of the total, by 2013.
Travel & Tourism is a major exporter, with inbound visitors injecting
foreign exchange directly into the economy.Travel & Tourism exports in
the EU are expected to represent 11.8 per cent of total exports in 2003.
In Croatia, exports make up a very important share of Travel & Tourism’s
contribution to GDP. Of total Croatian exports, services and
merchandise, Travel & Tourism is expected to generate 43.8 per cent
In the EU, the Travel & Tourism Industry is expected to post a GDP
(Kn39.6 billion, or US$5.1 billion) in 2003, increasing to Kn106.4
contribution of 4.2 per cent in 2003, while the Travel & Tourism
billion, or US$13.7 billion (56.2 per cent of total exports), in 2013.
Economy contribution will be 11.5 per cent.
Travel & Tourism is a catalyst for construction and manufacturing. In
In Croatia, the Travel & Tourism Industry is expected to contribute 10.6
2003, the private and public sectors combined are expected to spend
per cent to GDP in 2003 (Kn19.7 billion, or US$2.5 billion), rising to
US$686.0 billion in new Travel & Tourism capital investment worldwide
Kn52.2 billion, or US$6.7 billion (14.8 per cent of total), by 2013.The
– 9.6 per cent of total investment – rising to US$1.3 trillion, or 10.1 per
Travel & Tourism Economy contribution should grow from 22.4 per
cent of the total, in 2013.
cent (Kn41.6 billion, or US$5.4 billion) to 31.6 per cent (Kn111.6
billion, or US$14.4 billion) over the same period.
Travel & Tourism is a high-growth activity, which is forecast to increase
its total economic activity by 4.6 per cent per annum worldwide in real
terms over the next ten years.
In the EU,Travel & Tourism is expected to post average annualized gains
of 4.2 per cent between 2003 and 2013.
The EU’s Travel & Tourism Capital Investment should total US$194.4
billion in 2003, or 10.4 per cent of total regional capital investment.
Year 2003 capital investment in the Croatian Travel & Tourism Economy
is estimated at Kn4.9 billion (US$635 million) or 11.1 per cent of total
investment. By 2013, this should reach Kn10.6 billion (US$1.4 billion)
or 10.7 per cent of total.
Travel & Tourism is both a generator and receiver of government funds.
For Croatia,Travel & Tourism economic activity is expected to grow by
Globally, in 2003, Travel & Tourism is expected to generate US$843.6
6.9 per cent per annum in real terms between 2003 and 2013.
billion of taxes – 11.7 per cent of total taxation – while channelling
Travel & Tourism is human resource intensive, creating quality jobs
across the full employment spectrum. In 2003, one in 13.3 jobs will be
generated by the Travel & Tourism Economy. The Travel & Tourism
Industry accounts for 2.6 per cent of global employment.Today there are
US$224.1 billion of government expenditures, or 3.9 per cent of total
expenditures. By 2013, taxes should increase to US$1.5 trillion – 12.4
per cent of the total – and government spending on Travel & Tourism to
US$378.2 billion – 4.1 per cent of total government expenditure.
67.4 million Industry jobs and 193.2 million jobs in the Travel &
Government Travel & Tourism operating expenditures in Croatia in
Tourism Economy, and these will rise to 84.7 million Industry jobs and
2003 are expected to total Kn465.9 million (US$60.1 million) or 1.1 per
247.1 million Travel & Tourism Economy jobs by 2013.
cent of total government spending. In 2013, this spending is forecast to
The EU’s Travel & Travel Industry is expected to generate 7.5 million
jobs in 2003 (4.5 per cent of total employment), while the broader Travel
& Tourism Economy will account for 20.8 million jobs (12.5 per cent
of total employment).
In Croatia, in 2003, Travel & Tourism Economy employment is
24
rise to Kn944.3 million (US$121.8 million), or 1.4 per cent of total
government spending. Croatian taxes associated with Travel & Tourism
are expected to total Kn8.5 billion (US$1.1 billion) or 16.8 per cent of
total tax collections in 2003. By 2013, this tax revenue is expected to
increase to Kn21.2 billion (US$2.7 billion), or 23.4 per cent of total tax
revenue collected in Croatia.
CROATIA ESTIMATES AND FORECASTS
Kn mn
Personal Travel & Tourism
Business Travel
Government Expenditures
2003
% of Total
Growtha
Kn mn
2013
% of Total
Growthb
12,598.0
11.0
20.1
31,106.8
15.5
6.6
3,922.9
---
8.1
7,293.9
---
3.6
465.9
1.1
21.2
944.3
1.4
4.5
4,921.3
11.1
-6.3
10,635.3
10.7
5.2
Visitor Exports
35,474.9
39.3
4.0
93,693.7
49.5
7.3
Other Exports
4,102.0
4.5
-2.2
12,735.6
6.7
9.1
Capital Investment
61,485.0
---
5.9
156,410.0
---
6.9
T&T Industry GDP
19,664.7
10.6
3.2
52,239.1
14.8
7.4
T&T Economy GDP
41,609.9
22.4
3.7
111,590.0
31.6
7.5
T&T Industry Employmentc
139.0
13.0
-2.2
200.1
15.9
3.7
T&T Economy Employmentc
294.1
27.4
-2.5
427.4
33.9
3.8
a2002 Real Growth Adjusted for Inflation (%); b2003-2013 - Annualized Real Growth Adjusted for Inflation (%); cEmployment in '000 Jobs
EUROPEAN UNION ESTIMATES AND FORECASTS
US$ mn
661,330
Business Travel
2003
% of Total
Growtha
US$ mn
2013
% of Total
12.2
-0.5
1,115,500
171,340
---
-2.5
292,260
---
3.1
60,650
3.2
1.3
93,432
3.2
1.9
Capital Investment
194,410
10.4
-0.3
340,160
10.5
3.3
Visitor Exports
211,060
6.0
-5.9
509,080
6.3
6.7
201,850
5.8
-4.7
487,520
6.0
6.9
1,500,600
---
-2.0
2,837,900
---
4.2
Other Exports
T&T Industry GDP
T&T Economy GDP
13.1
Growthb
3.0
389,800
4.2
-1.9
660,570
4.4
3.0
1,083,300
11.5
-1.6
1,882,600
12.5
3.3
7,468.1
4.5
-2.4
8,356.1
4.8
1.1
20,843.0
12.5
-1.6
23,629.0
13.6
1.3
WORLD ESTIMATES AND FORECASTS
US$ mn
2003
% of Total
Growtha
US$ mn
2013
% of Total
Growthb
2,157,260
10.0
0.8
3,862,270
10.8
3.6
Business Travel
488,765
---
-2.9
871,716
---
3.7
224,058
3.9
3.8
378,172
4.1
3.0
Capital Investment
685,957
9.6
0.6
1,308,620
10.1
4.3
Visitor Exports
530,912
5.9
-4.3
1,332,080
6.0
7.1
Other Exports
478,952
5.3
-0.7
1,186,990
5.4
7.2
4,565,600
---
-0.3
8,939,730
---
4.6
T&T Industry GDP
1,290,770
3.7
-0.5
2,279,200
3.8
3.5
T&T Economy GDP
3,548,310
10.2
0.0
6,461,360
10.8
3.8
67,365.4
2.6
-2.8
84,684.5
2.9
2.3
193,246.0
7.5
0.0
247,106.0
8.4
2.5
25
TOTAL DEMAND
TRAVEL & TOURISM IN CROATIA IS EXPECTED TO TOTAL KN61.5 BILLION
(US$7.9 BILLION) OF TOTAL DEMAND IN 2003, INCLUDING:
■
■
■
■
■
Kn12.6 billion (US$1.6 billion) of Personal
Travel & Tourism consumption by residents
of Croatia (11.0 per cent of total personal
consumption);
Kn3.9 billion (US$506.2 million) of
Business and Government Travel by
resident companies and government
employees;
Kn465.9 million (US$60.1 million) of
Government Expenditures, 1.1 per cent of
total government spending in Croatia, to
provide individual and collective services
to the Croatian Travel & Tourism Industry
and its visitors;
Capital Investment, 11.1 per cent of total
capital investment in Croatia, in personal,
commercial and public Travel & Tourism
facilities, equipment and infrastructure by
residents,Travel & Tourism companies and
government agencies;
Kn35.5 billion (US$4.6 billion) of Visitor
Exports, or 39.3 per cent of total exports
in Croatia, generated from international
visitor markets; and
■
Merchandise Trade Exports, 4.5 per cent
of total exports in Croatia.
This breakdown of Croatia’s Travel &
Tourism demand clearly illustrates the fact that
international visitor spending accounts for
nearly 40 per cent of the Croatian Travel &
Tourism Economy. This would suggest that
priority must be given to protecting and
ensuring international (inbound) Travel &
Tourism.
Over the past seven years (1996-2002),
Croatia’s Travel & Tourism activity has grown
by a healthy 70.3 per cent in real terms. This
compares with 20.3 per cent cumulative
growth over the same period for the European
Union and with 23.9 per cent growth for the
world overall. Although September 11, 2001
had a noticeable impact on EU Travel &
Tourism in 2001 and 2002, Croatia appears to
have weathered the storm and continued to
CROATIA
Travel & Tourism Total Demand
(2003 Est. Kn bn)
enjoy growth in Travel & Tourism Demand.
The long-term outlook for growth in
Croatia’s Travel & Tourism Demand is
expected to be consistently positive at 6.9 per
cent per annum. WTTC/OEF expect strong
growth in visitor exports (7.3 per cent per
annum) for the foreseeable future, providing
necessary support for personal Travel &
Tourism, business travel, capital investment and
government expenditures – which are
expected to post similarly consistent if not
slightly slower growth. Overall, Croatia’s Travel
& Tourism is expected to grow by 10.6 per
cent in 2003.
Over the next ten years, growth in
Croatia’s Travel & Tourism Demand is
expected to average 6.9 per cent per annum. If
the forecast proves correct, the growth would
exceed expected worldwide growth of 4.6 per
cent per annum, and the 4.2 per cent annual
average growth projected for the EU.
CROATIA
CROATIA
(Cumulative Real Growth, %)
Business Travel (3.9)
Personal Travel & Tourism (12.6)
9,000
200
Other Exports (4.1)
175
8,000
150
125
7,000
100
6,000
75
50
5,000
25
Visitor Exports (35.5)
Capital Investment (4.9)
Government Expenditures (0.5)
1999
EUROPEAN UNION
(2003 Est. US$ bn)
Personal Travel & Tourism (661.3)
Other Exports (201.9)
Visitor Exports (211.1)
0
4,000
2000
2001
2002
2003
1995
2004
EUROPEAN UNION
(1990 Constant US$ bn)
2000
2005
2010
EUROPEAN UNION
1,450
200
175
1,400
150
125
1,350
100
1,300
75
50
1,250
25
Business Travel (171.3)
Government Expenditures (60.7)
Capital Investment (194.4)
26
0
1,200
1999
2000
2001
2002
2003
2004
1995
2000
2005
2010
EMPLOYMENT
THE TRAVEL & TOURISM INDUSTRY IN CROATIA IS EXPECTED TO
GENERATE DIRECTLY 139,000 JOBS IN 2003.
A total of 294,100 jobs (direct and indirect)
are expected to be generated across the
broader spectrum of the Travel & Tourism
Economy encompassing:
■
travel company employment,
■
government agency employment, and
■
supplier company employment.
The first category represents Travel &
Tourism Industry jobs, while all three
categories together equate to Travel & Tourism
Economy jobs.
Travel & Tourism Industry jobs in Croatia
totalling 139,000 in 2003 represent 13.0 per
cent of the country’s workforce. By 2013,
Travel & Tourism Industry employment is
expected to increase by 61,100 jobs to 15.9
per cent of total employment in Croatia.
The 294,100 Travel & Tourism Economy
jobs in Croatia in 2003 represent 27.4 per cent
of the total workforce. By 2013, Travel &
Tourism Economy employment is expected to
increase by 133,300 jobs in Croatia to 33.9 per
cent of total employment.
CROATIA
(‘000 Jobs)
Economy
400
Over the past seven years, Travel &
Tourism in Croatia has increased its share of
employment by almost 30,000 jobs and shed
two thirds of those, with part of the change
attributed to productivity gains and the
balance to a partial revision of data sources. In
2003, due to continued strong growth in
visitor exports, the employment outlook for
Travel & Tourism is extremely positive, with
employment gains expected to approach
20,000 jobs. Assuming a continuation of
positive economic growth and visitor exports
in the next few years, there is strong potential
over the next decade to create 13,000 new
jobs every year. The total number of jobs in
Travel & Tourism is expected to increase by
just over 3.7 per cent per annum between
2003 and 2013.
The charts below highlight a few points
of interest. First, Croatia’s Travel & Tourism
employment growth was strongly positive
following the ending of hostilities in the early
1990s, and slightly off since 1999 from a
CROATIA
Travel & Tourism Economy Employment
Industry
200
175
150
300
125
100
200
75
50
100
25
0
0
1999
2000
2001
2002
2003
EUROPEAN UNION
(‘000 Jobs)
25,000
Economy
1995
2004
2000
2005
2010
EUROPEAN UNION
Industry
200
175
20,000
150
125
15,000
100
10,000
75
50
5,000
25
0
0
1999
2000
2001
2002
2003
2004
1995
2000
2005
2010
combination of productivity increases and data
revisions.
Second, if Travel & Tourism employment
as a percentage of total employment in Croatia
is compared with the respective shares of
neighbouring and competing destinations,
Croatia ranks towards the top of the list. More
importantly, it ranks favourably in 17th position
among the list of 161 countries whose
performances are estimated by WTTC/OEF.
Finally, the growth rate projected for
Croatia’s Travel & Tourism employment over
the next ten years ranks at the top of the
competitor/neighbour listing but, at 86th
position, it ranks only midway in the global list
of 161 countries. Furthermore, if one
compares this ranking (86th) with its ranking
in terms of GDP growth (16th) on the
following page, one is tempted to conclude
that the structure and maturity of Croatia’s
economy and expectations for future
productivity gains prevents job creation from
matching the rate of GDP growth.
WTTC LEAGUE TABLE EXTRACT
(2003, % of Total Employment)
17
30
31
34
43
48
49
51
58
63
130
133
Croatia......................................27.4
Switzerland ..........................................17.0
Greece ..................................................16.9
Austria ..................................................16.6
France....................................................14.0
Czech Republic ..................................12.4
Italy ........................................................12.3
Bulgaria ................................................12.1
Germany ..............................................10.9
Hungary ................................................10.3
Romania ..................................................5.0
Turkey......................................................4.9
(10-Year Real Growth, Annualized, %)
86
104
127
130
133
135
138
139
142
152
153
157
Croatia........................................3.8
Bulgaria....................................................3.2
Romania ..................................................2.3
Greece ....................................................2.2
Czech Republic ....................................2.1
Turkey......................................................2.0
Switzerland ............................................1.8
France......................................................1.8
Austria ....................................................1.7
Hungary ..................................................1.2
Italy ..........................................................1.0
Germany ................................................0.4
27
GROSS DOMESTIC
PRODUCT
THE TRAVEL & TOURISM INDUSTRY IN CROATIA IS EXPECTED TO
PRODUCE DIRECTLY KN19.7 BILLION (US$2.5 BILLION) OR 10.6 PER
CENT OF TOTAL GROSS DOMESTIC PRODUCT (GDP) IN 2003.
The broader Travel & Tourism Economy
(direct and indirect) is expected to produce
Kn41.6 billion (US$5.4 billion), or 22.4 per
cent of total GDP.The long-term expectations
for Travel & Tourism GDP growth are positive
– 7.4 per cent annualized real growth. By
2013, Travel & Tourism Economy GDP is
forecast to gain 9.2 percentage points to total
31.6 per cent or Kn111.6 billion (US$14.4
billion).
The Travel & Tourism Economy results
and forecasts illustrate the massive economic
stimulus of Travel & Tourism. The first set of
charts (stacked bar) shows how the tourism
industry acts as a leading economic catalyst
since its contribution permeates through
Croatia’s Travel & Tourism Economy. These
charts also illustrate how positive and negative
changes in the Travel & Tourism Industry,
especially visible in the European Union chart
in 2001 and 2002, result in a much larger
impact on the broader Travel & Tourism
Economy.
In the second set of charts (Cumulative
Real Growth), Croatia’s Travel & Tourism
Economy shows massive growth post-1995
with only a small interruption in 1999. Also
evident is the strongly positive outlook for
growth over the next ten years. Overall, this
level of growth is even stronger than for the
overall Croatian economy, which continues to
post positive, but more modest gains. Because
Croatia’s Travel & Tourism Economy is
relatively young by EU standards, the
cumulative growth charts illustrate the vast
difference in long-term outlook.
CROATIA
Travel & Tourism GDP
8,000
Economy
Industry
175
6,000
150
125
4,000
100
75
2,000
50
25
0
0
2000
2001
2002
2003
2004
1995
EUROPEAN UNION
Travel & Tourism GDP
1,200
Economy
2000
2005
2010
Industry
200
1,000
150
800
125
600
100
75
400
50
200
25
0
0
28
2000
2001
2002
2003
22
38
39
41
43
46
49
58
67
71
100
126
EUROPEAN UNION
175
1999
(2003, % of Total GDP)
CROATIA
200
1999
The third set of charts (right) compares
WTTC/OEF estimates for Croatia and its
neighbours and competing destinations,
showing respective Travel & Tourism
Economy GDP as a percentage of total GDP.
Ranked at number 22 of 161 countries –
above Austria at number 38 and Greece at 39
– Croatia is clearly among the top-tier,
tourism-intensive countries. In addition, the
second league table extract illustrates how
Croatia’s prospects for GDP growth are also
leading most of its neighbours and
competitors within the world ranking – in
16th position. Only Turkey is expected to
achieve faster Travel & Tourism Economy
GDP growth than Croatia over the next ten
years.
2004
1995
2000
2005
2010
Croatia........................................22.4
Austria ....................................................14.8
Greece ....................................................14.6
Bulgaria....................................................14.1
Czech Republic ....................................13.1
Switzerland ............................................12.8
France......................................................12.4
Italy ..........................................................11.5
Hungary ..................................................10.4
Germany ................................................10.0
Turkey ........................................................8.1
Romania ....................................................5.8
4
16
51
60
65
126
134
140
150
153
155
156
Turkey ........................................................9.1
Croatia..........................................7.5
Czech Republic........................................6.2
Hungary ....................................................6.1
Bulgaria......................................................6.0
Greece ......................................................4.6
Romania ....................................................4.2
France ........................................................3.7
Italy ............................................................3.1
Austria ......................................................2.9
Germany ..................................................2.7
Switzerland ..............................................2.7
CAPITAL
INVESTMENT
IN 2003, TRAVEL & TOURISM CAPITAL INVESTMENT IN CROATIA IS
EXPECTED TO TOTAL KN4.9 BILLION (US$635.0 MILLION), OR 11.1 PER
CENT OF TOTAL INVESTMENT.
The largest component of capital investment
originates from the private sector in new plant
and equipment, while the public sector invests
in new Travel & Tourism infrastructure.
This represents a return to capital
investment growth following four years of
real-term decline beginning in 1999. Over the
next ten years (2003-2013), the contribution
of Travel & Tourism to Croatia’s capital
investment account is expected to increase at
an average rate of 5.2 per cent per annum in
real terms.
Examination of Travel & Tourism Capital
Investment results and forecasts lends greater
insight into the market forces at work in a
given economy and the expectations by the
public and private sectors to meet the
challenges and opportunities in the years ahead.
For the most part, Travel & Tourism Capital
Investment tends to be cyclical, with strong
links to major public policy initiatives, the
business/market cycle, major events (such as
natural disasters) and significant socio-political
changes.
Worldwide, Travel & Tourism Capital
Investment is expected to total 9.6 per cent of
total investment in 2003. The expectation for
global growth for 2003-2013 is 4.3 per cent
per year (in constant US dollars). In the
European Union, the respective figures are
10.4 per cent of total capital investment in
2003 and 3.3 per cent real growth over the
coming decade.
The charts below illustrate several
interesting points. First, Croatia’s Travel &
Tourism Capital Investment is expected to
return to positive growth following its fouryear decline. Second, when compared with
CROATIA
Travel & Tourism Capital Investment
200
175
150
700
125
100
600
75
50
500
25
0
400
2000
2001
2002
2003
1995
2004
EUROPEAN UNION
2000
2005
2010
200
175
150
175
125
100
170
75
50
165
25
0
160
2000
2001
2002
2003
32
47
58
89
92
110
117
119
125
126
136
143
EUROPEAN UNION
180
1999
(2003, % of Total)
CROATIA
800
1999
neighbouring and other competitive countries,
Croatia ranks well up the listing, but it comes
only half-way down the broader list of 161
countries from around the world in terms of
investment in 2003.With 11.1 per cent of total
investment, Croatia Travel & Tourism share of
total capital investment puts it in 89th
position, between Bulgaria in 58th position
and the Czech Republic in 92nd.
However, similarly to its ranking in GDP
growth, Croatia’s Travel & Tourism Capital
Investment growth (prospects for 2003-2013)
places it in the top tier of the WTTC league
table for the comparative and the world listings
– in third and 32nd places respectively. This
ranking sends a strong message to Travel &
Tourism operators at home and abroad that
Croatia is set to attract new ventures.
2004
1995
2000
2005
2010
Greece ....................................................22.5
Austria ....................................................16.0
Bulgaria....................................................14.1
Croatia........................................11.1
Czech Republic ....................................10.9
Switzerland ..............................................9.4
Italy ............................................................8.9
Germany ..................................................8.7
France ........................................................8.2
Romania ....................................................8.2
Turkey ........................................................7.4
Hungary ....................................................6.9
2
28
32
43
45
69
91
104
127
144
149
159
Turkey ........................................................8.5
Hungary ....................................................5.2
Croatia..........................................5.2
Czech Republic........................................4.9
Greece ......................................................4.8
France ........................................................4.2
Italy ............................................................4.0
Austria ......................................................3.6
Bulgaria......................................................3.0
Romania ....................................................2.6
Switzerland ..............................................2.4
Germany ..................................................1.0
29
PERSONAL & BUSINESS
IN 2003, CROATIA IS EXPECTED TO GENERATE KN12.6 BILLION (US$1.6
BILLION) OF PERSONAL TRAVEL & TOURISM CONSUMPTION BY
RESIDENTS, OR 11.0 PER CENT OF TOTAL PERSONAL CONSUMPTION.
In Croatia, business travel in 2003 is expected
to total Kn3.9 billion or US$506.2 million (65
per cent corporate, 35 per cent government).
Unlike visitor exports, which depend on
international markets for consumers, the
business generated in these two categories
depends on the Croatian economy itself. As
the Croatian economy grows, Croatian
consumer and business travel will follow suit.
Since 1995, Croatian Personal Travel &
Tourism has grown by only 36 per cent –
clearly indicative of the economy’s struggle to
rebuild. Over the next decade (2003-2013),
Personal Travel & Tourism in Croatia is
expected to grow at an annual rate of 6.6 per
cent, while Business/Government Travel is
expected to grow at an annual rate of 3.6 per
cent.
Although most of this Travel & Tourism
occurs within Croatia, a portion takes place
abroad. When the spending does take place
abroad, the satellite account generates a
corresponding ‘import credit’, providing for an
accurate assessment of Travel & Tourism
‘produced’ in Croatia and Travel & Tourism
‘produced’ by the rest of the world.
Analysis of Croatia’s results highlights a
few interesting points. First, Croatia’s residents
have recently spent about 11.0 per cent of
their personal expenditures on Travel &
Tourism. This percentage is slightly above the
world average of 10.0 per cent and only
slightly lower than the European Union
average of 12.2 per cent. Generally, the level of
personal Travel & Tourism spending is directly
linked to the development of the resident
economy. As per capita income increases, so
does Travel & Tourism spending. Second,
Croatia’s overall macroeconomic situation
since the cessation of hostilities in the mid-
CROATIA
Personal & Business Travel & Tourism
2,500
Business
Personal
CROATIA
200
175
2,000
150
125
1,500
100
1,000
75
50
500
25
0
0
1999
2000
2001
2002
2003
1995
2004
EUROPEAN UNION
Personal & Business Travel & Tourism
800
Business
Personal
2000
2005
2010
150
125
100
75
50
200
25
0
0
1999
30
2000
2001
2002
2003
2004
9
15
22
30
32
34
52
59
61
68
69
125
1995
2000
2005
Austria ....................................................15.9
Switzerland ............................................14.3
France......................................................12.6
Germany ................................................11.3
Italy ..........................................................11.1
Croatia........................................11.0
Bulgaria......................................................9.4
Greece ......................................................8.4
Turkey ........................................................7.8
Hungary ....................................................7.3
Czech Republic........................................7.3
Romania ....................................................4.6
175
400
(2003, % of Total Personal Consumption)
EUROPEAN UNION
(Cumulative Real Growth,%)
200
600
1990s has manifested itself in mixed positive
and negative Croatian resident spending on
Travel & Tourism, as illustrated in the stacked
bar and cumulative growth charts below.
Nevertheless, the cumulative growth
charts for Croatia and the EU below illustrate
the strong future growth outlook for Croatia
well beyond that of EU Travel & Tourism
spending. If, as expected, the economy
continues to show positive growth, Croatia’s
residents’ spending on personal and business
Travel & Tourism is also likely to accelerate.
Finally, the league table extracts reinforce this
message of cautious positive spending. Croatia
ranks in the top tier of countries (34th
position) in terms of current Travel & Tourism
spending vis-à-vis total personal consumption,
and it is also projected to rank in the top tier
in terms of future growth in Travel & Tourism
spending.
2010
2
34
40
42
50
132
136
150
151
153
154
159
Turkey ........................................................9.4
Czech Republic........................................6.9
Hungary ....................................................6.7
Croatia..........................................6.6
Bulgaria......................................................6.2
Greece ......................................................3.9
Romania ....................................................3.8
France ........................................................2.9
Italy ............................................................2.9
Austria ......................................................2.8
Germany ..................................................2.8
Switzerland ..............................................2.4
EXPORTS
TRAVEL & TOURISM EXPORTS PLAY AN ABSOLUTE AND VITAL ROLE IN
CROATIA’S TRAVEL & TOURISM BUSINESS.
In 2003, Travel & Tourism services and
merchandise exports for Croatia are expected
to total Kn39.6 billion, or US$5.1 billion (90
per cent by visitors, 10 per cent by exported
consumer and capital goods), representing
some 64 per cent of total Travel & Tourism
Demand. Without question, as this category
grows and contracts, the health and vitality of
Croatia’s Travel & Tourism sector will reflect
the same trends.
Over the past ten years, the gains for
Travel & Tourism Visitor Exports have been
impressive by any measure. In constant terms,
gains for 2000 visitor exports totalled 24.2 per
cent, while gains in 2001 totalled 19.2 per
cent, even after considering that the latter part
of 2001 was significantly impacted by the
events of September 11, 2001. If considered
over a longer period, (1995-2002), Croatia’s
Visitor Exports have grown by 122 per cent in
real terms. Over the next ten years, Croatia’s
Visitor Exports are expected to grow by 7.3
per cent per annum, while Travel & Tourism
Merchandise Exports (non-visitor exports) are
expected to do even better with a growth of
9.1 per cent per annum.
Globally and for the European Union,
visitor exports are expected to grow at 7.1 and
6.7 per cent per annum respectively over the
next ten years (2003-2013).
Clearly, based on these forecasts, Croatia’s
Travel & Tourism Visitor Exports’ growth is
right on track, albeit slightly ahead of that of
its regional and global peers.
Although long-term expectations for
Croatia’s Travel & Tourism export growth
(2003-2013) are positive these forecasts, like
any others, depend on future events and are
therefore not guaranteed. The events of
September 11, 2001 in the USA, for example,
CROATIA
Travel & Tourism Exports
6,000
Other
Visitor
200
175
150
4,000
125
3,000
100
75
2,000
50
1,000
25
0
0
2000
2001
2002
2003
1995
2004
EUROPEAN UNION
500
Other
2000
2005
2010
Visitor
200
400
150
125
300
100
200
75
50
100
25
0
0
1999
2000
2001
2002
13
29
43
62
72
78
87
88
95
99
121
133
EUROPEAN UNION
175
1998
Travel & Tourism Visitor Exports
(2003, % of Total Exports)
CROATIA
5,000
1999
which had a major negative impact on tourism
in the USA and other parts of the world, are a
perfect example of uncertainty inherent in
forecasting.
Examination of the WTTC league tables
reveals that Croatia is placed in the lead
position among its competing and
neighbouring countries on the basis of current
visitor exports as a percentage of total exports.
In the second league table, Croatian visitor
exports’ growth illustrates the competitive job
ahead, since Croatia is ranked in 63rd place
and is overtaken by other countries such as
Turkey and Germany, which are growing a
little faster. This would seem to indicate that
greater attention should be paid by the public
and pr ivate sectors to maintaining
international visitor growth at higher levels.
2003
1995
2000
2005
2010
Croatia........................................39.3
Greece ....................................................24.9
Bulgaria....................................................18.6
Turkey......................................................12.3
Hungary ..................................................10.3
Austria ......................................................9.1
France ........................................................7.8
Czech Republic........................................7.6
Italy ............................................................7.0
Switzerland ..............................................6.6
Romania ....................................................3.7
Germany ..................................................3.0
21
47
54
61
63
73
83
106
122
129
140
142
Turkey ........................................................8.6
Germany ..................................................7.7
Bulgaria......................................................7.6
Romania ....................................................7.3
Croatia..........................................7.3
Czech Republic........................................7.1
France ........................................................6.9
Switzerland ..............................................6.5
Greece ......................................................6.3
Italy ............................................................6.2
Hungary ....................................................5.9
Austria ......................................................5.8
31
GOVERNMENT
IN 2003, NATIONAL AND LOCAL GOVERNMENT AGENCIES IN CROATIA
ARE EXPECTED TO SPEND KN465.9 MILLION (US$60.1 MILLION) OF
CURRENT OPERATING FUNDS FOR TRAVEL & TOURISM.
This represents 1.1 per cent of total
government expenditures, which are allocated
to providing individual and collective
government Travel & Tourism services to
visitors, travel companies and the community
at large. Over the next ten years (2003-2013),
Travel & Tourism Government Expenditures
in Croatia are expected to increase by an
average of 4.5 per cent per year in real terms.
Globally, the average government is
expected to contribute 3.9 per cent of
government expenditures to Travel &
Tourism-related functions and to increase this
spending by 3.0 per cent per annum over the
next ten years. The corresponding figures for
the European Union are 3.2 per cent of total
government spending and 1.9 per cent real
growth for the coming decade. Based on these
results,
Croatia’s
2003
government
contribution of 1.1 per cent suggests that it is
currently well short of its regional and global
competition for Travel & Tourism support and
services.
In this WTTC report, 2003 government
expenditures include individual expenditures
of Kn53.6 million (US$6.9 million) that can
be linked to individual visitors, such as
museum subsidies or immigration services.
But they also include collective expenditures
of Kn412.3 million (US$53.2 million) that are
undertaken for the community at large – such
as airport administration or tourism
promotion – but which have a logical service
connection to Travel & Tourism.
One would naturally assume there should
be a direct link between the impact of an
industry/sector like Travel & Tourism on the
economy (in terms of GDP) and the amount
of funding allocated by governments towards
that industry/sector. In Croatia, the 2003 ratio
of Travel & Tourism GDP (percentage of total
GDP) to government expenditures is 19.5:1.0.
CROATIA
Travel & Tourism Gov’t Expenditures
200
CROATIA
200
175
150
125
100
75
50
25
0
-25
-50
-75
-100
160
120
80
40
0
1999
2000
2001
2002
2003
1995
2004
EUROPEAN UNION
56
2000
2005
2010
175
150
54
125
100
75
50
25
50
0
1999
32
2000
2001
2002
2003
2004
Travel & Tourism Gov't Expenditures
(2003, % of Total Gov't Expenditures)
37
53
58
62
76
79
84
86
128
143
152
159
1995
2000
2005
2010
Switzerland ..............................................7.5
Hungary ....................................................5.1
Austria ......................................................4.9
Greece ......................................................4.4
Italy ............................................................3.7
Czech Republic........................................3.6
Bulgaria......................................................3.3
France ........................................................3.2
Germany ..................................................2.2
Romania ....................................................1.4
Croatia..........................................1.1
Turkey ........................................................0.6
Travel & Tourism Gov't Expenditures
EUROPEAN UNION
200
52
Worldwide and in the EU, this ratio is 2.6:1.0
and 3.6:1.0 respectively. This would suggest
that the Croatian government authorities are
returning significantly less to Travel & Tourism
than governments generally.
The league tables below reinforce this
particular point. First, Croatia’s government
expenditures for Travel & Tourism are
currently very low on a relative scale – second
from bottom of the list of neighbours and
competitors – as well as 152nd out of 161
countries on a global scale. More encouraging
is the outlook for growth – it ranks third
among its regional neighbours and 34th
among the worldwide listing of 161 countries.
Although the Croatian Government clearly
has significant spending priorities and
requirements that may be affecting these
results, Travel & Tourism spending is suffering
a significant competitive disadvantage in the
world marketplace.
5
21
34
86
127
128
148
152
157
158
160
161
Hungary ....................................................5.6
Czech Republic........................................5.0
Croatia..........................................4.5
Bulgaria......................................................3.6
Romania ....................................................2.7
Italy ............................................................2.6
Switzerland ..............................................1.8
Austria ......................................................1.6
France ........................................................1.2
Germany ..................................................1.1
Turkey ........................................................0.3
Greece ......................................................0.1
THE POLICY
FRAMEWORK
POLICY RECOMMENDATIONS
The Croatian Government clearly recognizes the role of Travel & Tourism as a
contributor to macro-economic growth and social development throughout the country.
This is reflected in the inclusion of tourism as one of 19 sections comprising the
government’s National Development Plan, the Strategic Development of Croatia in the 21st
Century.
Yet, while government accepts that Travel & Tourism has a role to play in
Policy-makers in Croatia have started to implement measures
achieving robust economic reforms, it does not appear to appreciate the
towards economic transition and to reduce the government’s direct
scope of the industry, nor its role as a catalyst for the development of
involvement in the provision of Travel & Tourism services. Power is
other areas of economic activity, such as agriculture, manufacturing or
being decentralized to local and provincial governments, while private
financial services. Moreover, it seriously underestimates the full potential
sector participation is being increased. Several priorities remain, such as
of Travel & Tourism – encompassing accommodation, transport, catering,
the acceleration and extension of privatization to more sectors of Travel
recreation and travel services – which can help the Croatian Government
& Tourism, including transport, thereby encouraging investment and the
achieve its targets of doubling gross domestic product (GDP) within 15
streamlining of regulation.
years with an average growth of 5-7 per cent per annum. The industry
WTTC commends the Croatian Ministry of Tourism for its
can also help reduce disparities between urban and rural areas, while
aggressive promotion of Travel & Tourism growth over the past seven
accelerating Croatia’s transition to a stable market economy.
years. Increasing the responsibility of the Ministry of Tourism to oversee
This lack of appreciation of Travel & Tourism’s potential means that
collateral government agencies and departments that have a direct or
government policies across all ministries tend to be drawn up without
indirect link to tourism, such as transport or the privatization fund,
sufficient attention to their impact on the tourism industry. Neglect of
would help ensure that tourism development meets the quality standards
this kind endangers the long-term success of Travel & Tourism, as well
required for sustainable growth in the longer term.
as sustained growth at the level that Croatia is enjoying today.
The Croatian Government should make Travel & Tourism a
Following the start of war in 1990, the country suffered several
strategic priority and factor the industry’s needs into mainstream policies
years of decline in demand and investment. Croatia’s Travel & Tourism
for employment, trade, investment, education and environmental
returned to growth in the second half of the 1990s, and performance
protection. The strategic importance of Travel & Tourism should be
over the last two years has been particularly impressive given the
communicated to all levels of government, industry and the local
uncertain global economic and political climate. According to the
communities. All government departments affected by, or impacting on,
Central Bureau of Statistics, international tourist arrivals increased by 6
Travel & Tourism development should be closely involved in developing
per cent in 2002 – and by more than 70 per cent from 1996 to 2002 –
and implementing national tourism policy. Against this background
while overnights grew by more than 3 per cent.
WTTC recommends that the Croatian Government:
The latest forecasts from WTTC and Oxford Economic
Forecasting (OEF), drawn up in early 2003, point to an average annual
growth in Travel & Tourism demand of 6.9 per cent over the next ten
PLAN FOR THE FUTURE
years, contributing 31.6 per cent to Croatia’s GDP by 2013. However,
Long-term Tourism Planning
several challenges lie ahead, and these must be addressed to ensure the
Long-term planning at a national level is a prerequisite for the successful
long-term sustainable development of Croatia’s Travel & Tourism, with
development of Travel & Tourism in Croatia, since the industry can be
maximum benefits for all stakeholders and at all levels of the economy.
fragile and adversely affected by short-term political considerations.
These challenges include the enhancement of product and service
The Croatian Strategic Development Commission for Tourism,
quality, as well as the development of much needed infrastructure and
McKinsey & Company and the German Investment & Development
human capital.
Company are in the process of developing the Croatian Tourism
It is clearly understood that the private sector is best placed to
Strategy 2010, which will replace the existing plan launched in 1993.
develop quality products and competitive services geared towards rapidly
The new strategy will need to be expedited swiftly and promoted
changing international and domestic demand, while the role of
widely, helping to guide the development of regional plans, such as that
government is to ensure the underlying conditions for market
of Istria, which is already underway.
confidence and sustainable development.
As well as updating the long-term National Tourism Policy that
33
assesses performance to date, identifying new issues requiring attention
investment and infrastructure needs. One example of such a threat is the
and setting new targets and objectives, the new strategy (and future
fast emerging image of Croatia as a cheap destination. This image can
regional plans) will need to address the following areas:
damage the levels of yield derived from Travel & Tourism and can
■
■
■
■
Propose a new set of targets to guide the industry forwards over the
influence the country’s ability to target desired markets and investors in
next five to ten years. It should support existing industry to meet
the medium to longer term.
these targets, while introducing ways to promote new
Monitoring Travel & Tourism trends on a regular basis implies the
developments and initiatives, to attract local and international
provision of good quality statistical data on Croatia’s Travel & Tourism,
investors.
including data on international visitor arrivals and departures, domestic
Involve all levels of government, the private sector and local
tourism, hotel operating performance, expenditure patterns, attitudes and
communities in the development of the plan, helping to overcome
preferences, as well as the overall economic contribution of Travel &
conflicting objectives and interests.
Tourism.
Start from a vision of the kind of Travel & Tourism that both the
A national Tourism Forecasting Council (TFC) – established along
government and the citizens of Croatia wish to develop, in physical
the same lines as Australia’s successful TFC, in which all stakeholders are
and marketing terms.
well represented – could be a useful tool for ensuring the credibility of
One of the key priorities in establishing the plan and thereafter
historical results and future demand forecasts. It could also help to
should be to increase the level of cooperation between tourism
mitigate serious supply shortages or oversupply in the future.
boards and the private sector. Supervisory bodies of the tourism
boards in Croatia currently have little private sector representation.
■
■
promoting voluntary accreditation schemes for the industry and
Encourage Greater Market and Product
Diversification
outlining best practice in tourism development.
Croatia faces intense competition from a number of attractive, well-
Articulate product development and diversification within Croatia.
established and sophisticated Mediterranean tourism destinations,
Convey environmentally and culturally conscientious policies,
including Spain, Italy, Turkey and Greece. As a result of the war, these
A wealth of information to support the development of the
destinations are thought to have up to a ten-year advantage over Croatia
Croatian Tourism Strategy 2010 can be found in the Strategic Marketing
in terms of Travel & Tourism development. During the period of the war,
Plan – Croatian Tourism 2001–2005, commissioned by the Croatian
these destinations evolved to meet changing consumer demands,
National Tourist Board and prepared by THR International Tourism
investing in new infrastructure, diversifying their tourism products, and
Consultancy and Horwath Consulting Zagreb.This plan proposes targets
strengthening their presence in markets that were once Croatia’s main
to reinvent and restructure Croatia’s tourism products. It identifies eight
sources of international visitors, including Germany, Italy,Austria, the UK
regional clusters within the country and proposes that each cluster
and the Benelux countries.
develop competitive and complementary tourism products and
Open markets, more competitive pricing structures, technological
experiences. Focus is given to enhancing the quality of tourism products
advancements and changing consumer demand are now encouraging
and services, as well as developing a new brand identity for Croatia.
increased competition from destinations further afield, all looking to
Independent and objective information can also be found in the
entice the major overseas markets.
report commissioned by the German Federal Ministry for Economic
The country’s former Socialist system hindered Croatia’s ability to
Cooperation and Development in 2001.This plan was developed to help
keep pace with the demand for diversification in products and services,
strengthen regional cooperation within the Stability Pact for South
designed to meet more sophisticated travellers’ needs. Political instability
Eastern Europe. It helped to pave the way for several development
and war in the early 1990s had a serious impact on Travel & Tourism
projects within Croatia, serving as model projects, which have been
demand and resulted in declining investment. As a result, Croatia still
offered for financing to the international financial institutions from the
suffers from an inadequate infrastructure for Travel & Tourism, including
Stability Pact, as well as to private companies. These projects included
a lack of diversification in tourism products and services. This largely
regional development models for Dubrovnik, Kupari, Konavle, the island
explains the high level of seasonality in Croatia’s tourism.
of Mljet and the Sava Valley from Sisak to Jasenovac.
The main concentration of Travel & Tourism activity takes place
There is no lack of informed opinion-makers and experts, from
between June and September every year, with the majority of tourists
within and outside the country, ready to provide advice and input into
seeking sun and beach-based holidays. Investment is required to adapt
the strategic vision of Croatia. In this regard, we encourage all
tourism products and services to other market segments which, in turn,
stakeholders to participate.
will help ease the levels of seasonality affecting Croatia at this time and
reduce its unhealthy over-dependence on a few key market sources.
Monitor Trends in Travel & Tourism Demand
Marine/nautical Tourism
In order to plan ahead better and anticipate changing demand, it is
A warm climate, pristine waters, and an Adriatic coast that is home to
important to track trends in past and current Travel & Tourism demand.
more than 1,000 islands make Croatia an ideal destination for sailing
Monitoring trends will facilitate the identification of threats to growth,
holidays. Many of the country’s ports, particularly Dubrovnik, are already
as well as new opportunities, helping to anticipate future capital
popular with cruise lines. Data from Horwath Consulting Zagreb shows
34
that marine, or nautical tourism accounts for more than 13 per cent
of total tourist overnights in Croatia.
This sector has rightfully been identified as one offering huge
growth potential for the country’s Travel & Tourism industry.
According to the Central Bureau of Statistics, the number of vessels
using permanent moorings in Croatia increased by 76 per cent to
over 11,000 from 1997 to 2001, while the number of vessels moored
temporarily rose by 61 per cent to 165,000 over same period.
Many of the marinas and ports nonetheless require substantial
investment to accommodate growth in this sector and to enhance
the quality of infrastructure provided to tourists. Most of the marinas
are currently owned by the Adriatic Croatia International Club
(ACI) and two other state agencies, which collectively own more
than 80 per cent of the shares in 21 of the country’s marinas. Plans
to increase private ownership in ACI will help to stimulate much
needed investment towards developing the ports and marinas in
Croatia.
Resort Tourism
Resort tourism is already the most popular form of Travel & Tourism
in the country accounting for more than two thirds of total tourist
overnights. Although its market share has stagnated, and even fallen,
in the Mediterranean generally, the sector continues to attract
growth in absolute volumes. However, tourists today demand much
more than just sun, sand and sea.They are actively seeking resorts that
can provide high-class sporting facilities, non-stop entertainment,
spas and other facilities for health and wellness, and much more.
Croatia will require modern facilities that meet international
demand if it is to ensure sustained, long-term development in this
sector.While government policy should help stimulate investment in
this area, it should also help Croatia avoid the risk of over-developing
resorts in specific regions of the country.
This is an opportune time for Croatia to use the lessons it has
learned from short-sighted developments in other countries, such as
Spain. These have resulted in excessive construction and an overconcentration of buildings that have spoilt kilometres of coastline. In
fact, many destinations continue to make the same mistakes. Croatian
policy should help deter developers away from standardized
developments, which present no unique features, facilities or
authentic facets of the local region and culture. Policy developments
should also help to promote Croatia’s great opportunity to overtake
competitors in the development of environmentally and socially
sound resorts and accommodation facilities.
Special Interest Tourism
Demand for special interest and/or sporting holidays, such as golf,
is growing rapidly worldwide. Many operators actually believe that
destinations are now interchangeable and that the facilities offered
to accommodate special interests determine which destinations
today's tourists will choose. Croatia’s warm climate and natural
resources offer great potential to tap this market.There are already
plans to develop Croatia’s first golf resort. However, to gain
visibility in this sector and compete more effectively with
neighbouring destinations, further investments will be required in
35
order to provide visitors with a choice of courses boasting world-class
facilities and recognized brandnames.
MICE destination;
■
development of rural holidays and agricultural tourism. Incentive
Serve as an initial/focal point of contact, distributing leads and
allocating business transparently;
The Croatian Government has already started to stimulate the
■
measures have been introduced to encourage families with farms to
Provide conference industry leadership and coordination, raising
the level of professionalism in the sector;
adapt them for tourism purposes as a supplementary activity. In addition
■
Serve as a clearing-house of convention industry information;
to offering financial incentives, Croatian policy should promote the
■
Exert influence and link industry and government.
development of quality facilities that cause minimal damage to the local
Special events can complement the growth in conferences and
environment. Ease of access to, and widespread dissemination of, this
exhibitions. Croatia has already been successful in hosting several
information is vitally important. The National Tourist Board would
international events, such as the ATP Tennis Tournament in Umag. Such
provide an ideal central base for the collation and communication of
events can help put a small region like Umag on the global map. In order
news, guidelines and best practices for small to medium-sized enterprises
to secure future business with guaranteed economic returns for all
in Croatia, while regional boards would be well suited to promoting
stakeholders, the Croatian National Tourist Board should develop a
these sources of information, especially in rural areas.
sophisticated capability for the evaluation of special events and the related
economic returns, in order to assist in the future targeting of events.
Meetings, Incentives, Conferences and Exhibition
(MICE) Travel
Domestic Tourism
The meetings, incentives, conferences and exhibitions (MICE) market is
In 2002 domestic tourist arrivals totalled 1.3 million as against 1.6
relatively untapped in Croatia compared with leading European tourism
million in 1989.There is clearly room for growth, but the prospects for
destinations.The MICE business currently accounts for a modest 4 per
this would seem to be bright. As the Croatian economy grows, this
cent share of arrivals, although it has a strong potential for growth.
should stimulate consumer and business travel. If targeted effectively,
Croatia’s central European location, allowing for short journey times
domestic tourism can help generate increased earnings and employment
from most of Europe’s main cities, is a definite competitive advantage.
for less developed parts of the country, encouraging support from local
The sector is also a good one to develop further as it is relatively high
communities for tourism development.
yield and can generate strong visibility for the destination.
Several factors can influence the growth of domestic tourism.
Conference and congress facilities located in Zagreb, Opatija and
These include the effectiveness of marketing and promotion to local
Dubrovnik are performing well, hosting an increasing number of events
residents, the development of suitable tourism products and services and
every year. Recent growth in demand has led to the development of
– last, but by no means least – price, or value for money. According to
new facilities for medium-sized groups of up to 400 delegates.With the
the World Travel & Tourism Competitiveness Monitor, Croatia is
exception of the Vatroslav Lisinki Hall in Zagreb, which can
currently ranked 88th among 128 countries featured in the Price
accommodate up to 1,800, Croatia lacks the facilities to host large
Competitiveness Index (in which 128 is the least competitive).
international conferences. Development of the MICE market could
The ranking is based on each country’s rating within the Hotel
help Croatia attract new year-round business and enable the country to
Price Index, which compares hotel room rates for each country1, and
compete more effectively in the international marketplace.
the Purchasing Power Parity Index, which shows the amount of goods
The development of MICE facilities in Croatia will nevertheless
or services a single US dollar can buy within a given destination2.The
require big investment and international know-how, ensuring that
Monitor indicates that Croatia is relatively highly priced compared with
facilities meet international standards and can remain competitive
other countries featured, including several other Mediterranean
throughout their business cycles. A comprehensive approach to
destinations. Fiscal policies should therefore pay attention to the
development should be adopted, ensuring that hotel capacity and other
purchasing ability of residents, helping to ensure the growth of domestic
support facilities, such as transport links, are developed in line with the
as well as international visitors.
needs of new congress halls and conference centres. There are already
concerns in destinations like Dubrovnik, where existing and planned
conference facilities have not adequately taken into account future
delegates’ accommodation needs.
Croatia’s convention bureau efforts should be significantly
expanded, enhanced and perhaps re-engineered under a National
Convention Bureau (NCB) that is separate from the National Tourist
Board, in order to tap the potential of this important sector. Such an
NCB would play a valuable part in raising the level of the MICE
business in Croatia to that of an important economic contributor and
would embrace the following tasks:
■
Ensure complete coordination and synergy for the promotion of
Croatia’s MICE business;
■
36
Position Croatia in the international marketplace as a leading
Price Index
Price Competitiveness
Value
Ranking
Tunisia
82.30
27
Turkey
74.91
46
Cyprus
60.54
85
Croatia
59.53
88
Greece
54.90
93
Spain
40.66
107
France
40.33
108
Source:World Travel & Tourism Competitiveness Monitor, 2002
1Hotel room rates in US$ per night in 2002 Source: www.placestostay.com
2 Source:World Development Indicators,World Bank 2001
Invest More in Effective Marketing and
Promotions
National investment in the effective marketing and promotion of Croatia as
a tourism destination is critical to ensuring sustained demand from existing
markets and to generating new demand.The National Tourist Board should
continue to promote Croatia as a safe and welcoming destination, helping to
eradicate images of the country related to a war that ended over ten years
ago. Efforts should also focus on reducing seasonality, as well as on spreading
the benefits of tourism to all parts of the country. In addition, particular
attention needs to be paid to erasing the image of Croatia as a cheap
destination.
The Strategic Marketing Plan Croatia 2001–2005 outlines a new branding
strategy and positioning for Croatia. Aiming for a brand built on the
country’s well-preserved natural and cultural environment, Croatia has
adopted the slogan ‘Croatia – the Mediterranean as it once was’. This new
brand and the marketing strategy outlined in the report are aimed at
addressing Croatia’s image as a cheap, summer-only destination for the mass
market. This strategy is expected to be implemented aggressively over the
next five years and should help to increase tourism volumes and spending, as
well as to extend length of stay, improve geographic spread and seasonal
patterns of tourism. The strategy should be incorporated into the National
Tourism Policy and updated every five years, or as market trends require it.
National investment in the effective
marketing and promotion of Croatia as a
tourism destination is critical...
The Croatian National Tourist Board’s budget for tourism marketing
and promotion comes mainly from a tourist tax, which was established in the
early 1990s to fund the activities of the national, regional and city tourism
boards of Croatia.The budget covers the cost of all activities for the national
and regional tourism boards. As is the case in most other key tourism
destination countries, Croatia should work more closely with the private
sector to improve the effectiveness of marketing spend and to develop joint
promotional activities, which would help to sustain Croatia’s traditional
markets, while tapping into new markets.
The National Tourist Board should support efforts to promote tourism
in the less developed rural parts of the country and Croatia’s islands, in an
effort to stimulate growth in these regions. Inbound tour operators, or
destination management companies (DMCs), have an important role to play
in this area, as they can develop and market programmes offering new
tourism experiences in underdeveloped regions of the country. Croatia has
few experienced DMCs operating at national level. This is a handicap for
Croatia in its efforts to penetrate international source markets, whether
through foreign tour operators, travel agents, or directly with consumers.
Timely market intelligence is an important resource for DMCs, Travel
& Tourism operators and potential investors in Croatia.The National Tourist
Board should work in much closer partnership with provincial governments
and the private sector to facilitate the monitoring of trends and to stretch
research dollars.
37
HIGHLIGHT THE STRATEGIC
IMPORTANCE OF TOURISM
Implement Satellite Accounting
on an Annual Basis
Recognize Travel & Tourism’s Economic
Importance
Travel & Tourism needs to be measured effectively in order to understand
Travel & Tourism is Croatia’s leading export sector, generating the
Tourism is not discretely identified in charts of national or provincial
highest share of foreign exchange income. Not only does it enhance the
country’s balance of payments; it also creates large numbers of jobs and
long-term career opportunities, and stimulates entrepreneurial activity,
thereby contributing to reduce the country’s high rates of
unemployment.
The National Tourist Board should adopt a campaign to ensure that
all public and private sector stakeholders recognize Travel & Tourism’s
full impact across the national economy – not just on hotels, restaurants
its full impact throughout the economy. As a new industry, Travel &
accounts – its component parts are scattered throughout the accounts.
Public sector analysis and related policies tend to overlook, or at least
understate, the impact of the industry, or deal with its smaller individual
components.
Travel & Tourism is Croatia’s leading
export sector, generating the highest
share of foreign exchange income.
and retail business, but also on construction, real estate and other sectors.
Even more importantly, stakeholders should be made aware of the
The technique of satellite accounting is designed to measure the new
industry’s untapped potential and of the benefits of tourism that filter
service sectors. This new tourism satellite account (TSA), developed by
down through all levels of the community. Proposals to develop a
WTTC and OEF for Croatia, is a significant tool for planning and policy
National Tourism Congress, which would bring stakeholders together to
development. WTTC recommends that the Croatian Central Bureau of
discuss Travel & Tourism challenges and opportunities, would be an
Statistics update this TSA on an annual basis, to ensure that adequate data
effective way of promoting the importance of the industry to public and
is available to factor Travel & Tourism into economic and employment
private decision-makers.
strategies. The TSA is a significant tool for planning and policy
development.
38
DEVELOP THE HUMAN CAPITAL
REQUIRED FOR GROWTH
same time regulatory rigidities and protectionism should be avoided, as
these would have the reverse effect.
Using World Bank data on illiteracy rates, education, employment,
population, training and gender indicators, the World Travel & Tourism
The Grey Economy
Competitiveness Monitor provides an indication of Croatia’s
The WTTC/OEF TSA findings do not include the large number of
competitiveness, in terms of the quality of its human resources. On an
unregistered hospitality providers, operating in the so-called ‘grey
index from 0 to 100, in which 100 represents the best performance,
economy’ of Croatia. This hidden economy is estimated to cater for a
Croatia’s value is rated at 87. Even though this rating is favourable
substantial number of international visitors each year and comprises
compared with many of the countries featured in the Monitor – it gives
family-run facilities, with the host families having little or no training in
it a ranking of 51 out of 115 countries in terms of the quality of its
Travel & Tourism. Businesses in Croatia’s grey economy of continue to
human resources – this does not automatically benefit the Travel &
endanger the country’s efforts to erase its image as a cheap destination.
Tourism industry in Croatia. In fact, many international tour operators
The Croatian Government needs to tackle this issue quickly and,
and their clients confirm that service levels in Croatia are poor compared
through the introduction of incentive schemes, attract operators into the
with competing destinations. The Croatian Government should ensure
mainstream economy.
that human resource development meets the needs of the industry and
Place a High Priority on Education & Training
the demand for improved levels of service worldwide.
Given the projected growth in Travel & Tourism demand in Croatia, it
Human Resources Human Resources
is important to plan ahead to attract sufficient numbers of employees
Index Value
97.62a
Ranking
with the appropriate credentials. On the one hand there is a need for
12
higher academic skills and increased technological know-how, yet there
Spain
97.62
14
is also a need for more broad-based training, which helps develop a
Austria
96.43
15
variety of skills and customer service skills.
Italy
94.05
20
The attraction of leading multinational Travel & Tourism businesses
Greece
91.67
32
to Croatia would help the country gain access to globally competitive
Croatia
86.90
51
private sector training schemes, supporting student placements and
Turkey
73.81
95
research on industry/education advisory committees. However, the
France
majority of Travel & Tourism businesses in Croatia are small to mediumSource:World Travel & Tourism Competitiveness Monitor, 2002
a Where countries have the same Index Value, the Monitor ranks them in alphabetical order
sized enterprises employing fewer than ten people.These businesses lack
international know-how and the funds required for developing human
Few industries in Croatia have as pervasive an impact on the local community as Travel
& Tourism. It is one of the largest generators of employment in the country, offering
career opportunities ranging across the entire employment spectrum.
Promote a Positive Image of the Travel &
Tourism Industry as a Provider of Jobs and
Careers
resources. WTTC recommends that the Croatian Government play a
leading role in the development of human resources for the sustainable
growth of Travel & Tourism in Croatia.
Few industries in Croatia have as pervasive an impact on the local
Special attention has already been paid to placing education and
community as Travel & Tourism. It is one of the largest generators of
training at the forefront of Travel & Tourism development, introducing
employment in the country, offering career opportunities ranging across
it into school curricula and implementing measures to improve skills,
the entire employment spectrum.WTTC/OEF estimates show that the
such as training accreditation programmes. Other schemes, including the
Travel & Tourism Industry will directly generate around 13 per cent of
‘From University to Work’ programme, intended to assist graduates in
total employment in Croatia in 2003, or some 139,000 jobs.The Travel
finding employment within the sector, need to be promoted more
& Tourism Economy overall will account for a 27 per cent share, or
widely and more vigorously to employers and students themselves.
294,000 jobs. The number of jobs accounted for by the industry is
One of the main challenges facing Croatia is the increase in
expected to rise by 3.7 per cent a year between now and 2013, and
technology, which has changed the way the customer looks at
Travel & Tourism Economy employment will increase by a projected 3.8
price:value relationships and at how transactions are made. With the
per cent per annum over the period.
possible exception of universities, such as the Faculty of Tourism and
The Croatian Government should help to promote a positive image
Hospitality Management in Opatija, the country’s formal education and
of the industry as an employer to young graduates, who have a tendency
vocational training system has failed to adapt to the rapidly changing
to pursue careers in other fields, mainly outside the country.WTTC also
needs of the industry.
recommends that flexible working practices should be considered to
In its bid to attain higher quality services, Croatia will need to
increase industry responsiveness, productivity and innovation. At the
attract quality leadership to the Travel & Tourism industry, or grow its
39
own leaders. Bridging the gap between education authorities and the
industry, and establishing liaison groups between the two sectors, will help
public education authorities develop the skills required by the industry
ENCOURAGE OPEN MARKETS AND
SKIES AND REMOVE BARRIERS TO
GROWTH
Open Markets
Travel & Tourism needs to operate within open and competitive markets.
It is only in this way that the industry will be able to flourish and realize
its full socio-economic potential. There is no room for protectionism in
an industry that depends on the free movement of people and capital.
Instead, there is a need to create rapid and transparent systems of
interchange to deal with international trade and mobility. The World
Travel & Tourism Competitiveness Monitor shows that, with regard to its
openness towards international tourism – including visa requirements,
international trade and taxation – Croatia is currently ranked 57th out
of a total of 177 countries worldwide. This ranking highlights the fact
that that there is still much progress to be made in terms of increasing
Croatia’s competitiveness in this area.
The Croatian Government continues to implement tough economic
and monetary policy towards a liberal market economy. The start of
negotiations regarding the Stabilization and Association Agreement with the
EU was a major step on the country’s path to EU Membership. Similarly, its
membership of the World Trade Organization (WTO/OMC) reflects
Croatia’s determined approach to liberalization and open markets. Sustained
efforts should be made to incorporate Travel & Tourism as a key element in
the WTO/OMC mechanism and ongoing programmes towards progressive
liberalization. Reform policies should be pursued diligently and should be
conducive to the sustainable growth of Travel & Tourism that would, in turn,
accelerate Croatia’s attainment of economic targets. Broadly speaking, these
policies should include:
■
Reducing the size of government and the level of direct state
intervention;
■
Balancing budgets, healthcare and pension reforms;
■
Maintaining price and exchange rate stability;
■
Accelerating privatization;
■
Streamlining regulation and reducing red tape; and,
■
Attracting foreign direct investment.
Increase Private Participation in Tourism
Development and Promotion
During the war, hotels were used by the state to accommodate refugees.
Many refugees still remain in hotels throughout the country, although the
majority have now left or been rehoused in more permanent
accommodation. After the end of the war in 1995, hotel operators took
loans from banks to restore their properties in an effort to reopen hotels to
tourists. Interest rates at the time were extremely high, averaging 18 per
cent, with short grace periods. The Kosovo crisis in 1999 had a second
devastating impact on Travel & Tourism demand within a ten-year period,
putting most hotel operators with high levels of debt out of business.
The Privatization Fund established by the Croatian Government has
40
already privatized a number of hotels acquired through debt equity
Tax Intelligently
swaps, whereby state-owned banks wrote off the bad debts of hotel
Government taxation policies affect tourism demand and supply,
companies in return for shares in the enterprise. A number of hotels
irrespective of whether these policies relate to the economy as a whole
were also acquired by the government as a result of the privatization
or apply only to tourism. Taxation raises the price of tourism products
process, which started ten years ago, and these are now owned by the
and services and, if the price becomes too high compared with that of
Agency for the Rehabilitation of Banks and Deposit Insurances, the
competing destinations, tourism demand will fall. The strong
Privatization Fund or local authorities.
appreciation of the kuna makes this a very sensitive issue for Croatian
The Croatian Government has taken steps to encourage various
Travel & Tourism. Complex taxation regimes also deter investment.
forms of private sector participation including the provision of
Taxes associated with Travel & Tourism in Croatia are expected to
marketing and management services, joint ventures, lease agreements,
total Kn8.3 billion (US$1.1 billion), or 16.8 per cent of total taxes
concessions, the purchase of shares in hotels, and the outright purchase
collected in 2003.This is a significant share – much higher than in most
of hotel and leisure facilities as assets. Few hotels remain in state hands,
competing destinations.While Travel & Tourism should pay its fair share
as the Privatization Fund eagerly aims to meet its target deadline.
of taxes, the growth and prosperity of the industry – including the
However, by doing so, the Fund runs the risk of transferring hotel
investment necessary to generate these future revenue flows – will
properties into the hands of enterprises that do not have Travel &
depend in no small part on the competitiveness of Travel & Tourism.
Tourism expertise, nor any long-term vision for developing the hotel
This also depends on whether it receives equitable treatment to other
into a competitive and sustainable business enterprise.
industries and to competing destinations.
Evidence also suggests that disengagement of the State could be
In January 2001, the value-added tax (VAT) rate of 22 per cent on
damaging to the destination’s competitiveness if it is not done so
tourism services was waived for organized international inbound
effectively, with long-term interests at heart.WTTC recommends that all
tourism. Proposals to reduce the rate of VAT by more than half to a set
future efforts towards privatization be undertaken in close cooperation
rate for the industry should be implemented swiftly, helping to provide
with the Ministry of Tourism, enabling the Ministry to lead the decisions
a more competitive environment for Croatia’s Travel & Tourism
taken by the Privatization Fund. This will ensure that decisions are
operators, as well as to encourage domestic tourism.Tourist levy charges
complementary to the vision and long-term objectives for Travel &
also need close scrutiny, to ensure that travellers are not paying duplicate
Tourism development established in the National Tourism Policy.
or multiple fees for what they see as a single journey. As an example,
each of Croatia’s main airports – owned by the local authority and
Croatia’s attractiveness to foreign direct investment is also hampered by frequent changes
in regulation and the absence of a legal framework providing protection of investments
for potential investors.
Attract Foreign Investment
acting as an autonomous entity – charges passengers its own air
Recognizing the value of international expertise, the power of
passenger duty tax, with varying rates for international and domestic
international brands in attracting high-spend international visitors, and
departures. For passengers transiting via one or another airport, this
the immense job-creating potential of multinational Travel & Tourism
sometimes results in a duplication of taxes, adding to the price of what
businesses, the Croatian Government has actively opened markets to
is perceived to be a single journey.
internationally recognized management companies such as Sol Meliá,
New tax proposals are currently under consideration by the
Hilton and Starwood Hotels. In terms of investment into real-estate,
Croatian Government. These include a new tourism tax, to be
property and development projects, challenges remain that continue to
introduced in the coming year, which will require all private homes
hamper the attractiveness of Croatia to the world’s leading Travel &
offering more than 20 beds to register their activities and pay their due
Tourism companies. Tackling these challenges should be made a key
taxes.The new proposals will also require homes offering more than six
priority in the National Tourism Policy and should be adopted by all
beds to pay a fixed rate of tax each year. While these proposals will go
government agencies, including the Privatization Fund. Priorities
some way to stamping out the grey economy, care should be taken to
include increased transparency in the privatization process, land
ensure that they do not harm the overall productivity of the sector.
ownership issues, the removal of red tape and intelligent taxation.
There is a tendency worldwide for governments to target Travel &
Land ownership issues in Croatia concern land surrounding
Tourism as a revenue generator to meet short-term budget objectives,
properties that have been or are in the process of privatization, such as
with little thought to the long-term consequences on demand and job
the outdoor facilities of hotels and campsites.A delay in the resolution of
creation.
land ownership issues between the state, private land owners and the
WTTC recommends that the Croatian Government develop fiscal
industry will hamper much needed investment in the renovation of hotel
regimes that encourage tourism growth, exports, investment,
properties. Croatia’s attractiveness to foreign direct investment is also
infrastructure, business innovation and job creation. The ‘User Pays –
hampered by frequent changes in regulation and the absence of a legal
User Benefits’ principle should be applied, with funding collected
framework providing protection of investments for potential investors.
earmarked for the related Travel & Tourism infrastructure, transparently
41
dispersed and with collection time limited to the specified project
will improve regional networks.An expansion of liberal aviation accords
completion. Given the price sensitivity of tourism, special taxes should
will help to attract an increased number of scheduled flights and charter
not be levied on the tourism industry unless they are hypothecated – in
activity from Croatia’s main markets, while low-cost carriers can help
other words, unless the revenues derived therefrom are used wholly and
generate new markets from within Europe, greatly benefiting local
exclusively for tourism development and/or marketing.
economies. By way of example, plans for Ryanair to operate direct
services between the UK and Pula will help to market Pula as a
Facilitate Airline Access, Air Transport
Liberalization and Open Skies
destination in its own right to the UK market, bringing Travel &
Tourism growth to the region.
One of the biggest challenges facing Croatia’s Travel & Tourism industry
is that of developing a competitive air transport environment. Air
Enhance Safety & Security
transport is the second most important means of access to, from and
The conflict over Croatia’s independence led to land mines being laid
within Croatia and, for some markets, it is the most important.
on Croatian territory, mostly in former areas of confrontation, including
Nevertheless, the national carrier, Croatia Airlines, has a relatively small
the Danube region and the former Krajina.The government continues
international fleet, which mainly operates between Zagreb and
to de-mine affected areas. High priority must be given to completing
Germany. As a result, traffic rights for airlines operating from many
this process so as to avoid the risk of accidents involving local residents
major European cities and potential tourism generating markets are
or tourists.
restricted.The shortage of airline services has also had a negative impact
Public safety and security do not pose major problems in Croatia
on Zagreb’s aim to become a major gateway between western and
at the present time. However, isolated incidents resulting from actions
southeastern Europe.
prompted by ethnic tensions have occurred. Therefore, these incidents
The Croatian Government should not be tempted to protect its
national carrier in this way, but should open its air transport market to
attract more international services – both short- and long-haul – which
42
should be factored into central and local policing strategies, with
contingency plans drawn up to protect tourists.
MATCH PUBLIC AND PRIVATE
INFRASTRUCTURE WITH
CUSTOMER DEMAND
Expand Infrastructure
that require urgent attention, such as connectivity between the airports
and major cities and improvements to slip roads linking the motorways
with towns and coastal areas.
Six of the country’s nine international airports are located on the
Adequate infrastructure and access to generating markets are two of the
Croatian coast. Bad weather conditions have a serious impact on airline
most important prerequisites for the development of any Travel &
service to and from these airports, and urgent improvements to road and
Tourism destination.Without these two components, the industry’s full
rail connections are required. As an example, many flights approaching
potential for employment, export earnings and regional development
Dubrovnik airport, situated close to the Adriatic Sea coast, have to be
cannot be achieved. The infrastructure requirements of the industry
redirected to Split in bad weather conditions. Construction of a new
affect most other sectors of the economy and, in most cases, public
runway may not be feasible due to geographic limitations. Poor
infrastructure that supports Travel & Tourism expansion will serve other
connectivity between the two airports, in terms of road and rail (there
urban and regional development purposes.
is currently no rail connection), extends potential journey times by up
Quality infrastructure is essential to diversify Croatia’s product
to three hours.This does not bode well for Dubrovnik’s aim to develop
base, remove bottlenecks, ensure good service and distribute the
tourism throughout the autumn and winter seasons, especially the
benefits of tourism flows across the economy. It is not only a question
MICE market.
of coping with increasing numbers of visitors, but also of making sure
WTTC recommends that a task force be established, involving
that the patterns of flow do not affect the natural or built heritage, nor
public and private sector leaders from the two regions, to identify and
run counter to local interests.
discuss new approaches to accessibility for the region during the autumn
The Croatian Government has made considerable investments in
and winter months, when weather conditions are at their worst.
the development of municipal infrastructure, including a major waste-
Airport expansion and modernization, as well as streamlined
water treatment plant, which will improve the safety and reliability of
immigration and border clearance facilities, need to be upgraded in most
drinking water in the region of Zagreb, and prevent pollution of the
of the country’s airports. The efficiency of transport-related
Sava River. The government has acquired high levels of financial
infrastructure can play a significant role in customer acceptance of
support from international creditors – including the European Bank for
airport hubbing strategies.
Reconstruction & Development, the World Bank and the European
Sea-related activities, including marine/nautical tourism, are
Investment Bank – for this and other important developments that will
estimated to represent more than 90 per cent of total tourist activity in
support the growth of Travel & Tourism in Croatia.
Croatia3. This sector is expected to attract high levels of growth in the
Good communications are essential to the successful development
foreseeable future. Nevertheless, investment in the improvement of
of any business. Travel & Tourism, which moves people and services
marinas and ports has not been in line with the projected growth in
across wide geographical areas, requires excellent transport networks.
demand. Poor connectivity between the islands and the speed and quality
Three important infrastructure developments have been initiated to
of transfers between the islands and the mainland of Croatia continue to
facilitate improved connectivity and transport links, supporting
hamper investment and Travel & Tourism demand for these regions.
economic growth both within Croatia and between the country and
Investment in seaports and airports on the islands will help to spread
tourism generating markets.These include:
economic opportunities, wealth and jobs to these local communities.
■
■
■
The rehabilitation of the railway infrastructure and the
There is a general acceptance that the highest priority for Croatian
modernization of the Croatian railway linking the country to
Travel & Tourism development at this time is the speedy reconstruction
Hungary and Bosnia Herzegovina. The project will contribute to
and restoration of hotel accommodation in the country. Most Croatian
the improvement of railway service on an important transit
hotels were constructed between 1960 and 1980 to accommodate
corridor, assisting the integration of Croatia with neighbouring
visitors from other socialist economies of the time.Thus accommodation
countries and with the EU. This development could help spur
standards do not comply with the international standards expected by
more growth in Travel & Tourism from these markets and with
the more sophisticated travellers of today. The structure of many
markets further afield.
properties needs to be modified to meet international requirements, star
The construction and rehabilitation of motorways throughout the
ratings and quality benchmarks. Urgent investment is needed in this area
country, starting with one of the country’s main motorways, a 189-
to bring Croatia’s hotel capacity up to the level required to meet the
kilometre toll road, which will link Zagreb with the coastal city of
projected growth in Travel & Tourism demand over the next ten years.
Split, and eventually Dubrovnik further down the Dalmatian coast.
According to estimates by the German Investment & Development
In anticipation of growing air traffic in and around Croatian
Company, there are currently less than half the number of hotel beds in
airspace, Croatia Control Limited – the country’s air navigation
the three- to five-star categories required to meet the projected demand
service provider – will replace the core air traffic management
for 70 million overnights by 2010.
system, including radar data, flight processing systems and
Government proposals to introduce a programme entitled
communication equipment, towards facilitating growth and
‘Incentive for Success’ will help to increase levels of private home/villa
ensuring safe operations.
accommodation.The government is contemplating a proposal to secure
While these developments will assist Travel & Tourism growth and
economic development for the country, there are several other areas
3Data from Horwath Consulting Zagreb
43
a low, set rate of interest on loans to expand and modernize local homes
as private villas, in order to accommodate more tourists. It is generally
accepted that, while this measure would help upgrade the quality of
accommodation facilities, it would not help expand infrastructure to
meet the projected growth, as many of these homes are already in use
for this purpose. The National Tourism Policy should aim to attract a
diversity of accommodation types, especially hotel developments – a
sector that requires urgent expansion.
Improve Land-use Planning and Protection
Land-use planning by regional governments and local authorities,
particularly zoning, should be encouraged to protect the character of
the natural environment, which is one of Croatia’s major attractions for
residents and visitors alike. The Croatian Government should address
the potential danger of uncontrolled real-estate development that may
affect the positioning of Travel & Tourism in Croatia and the value
offered to international visitors. In this case, the introduction of
incentive programmes for private sector capital investment and small
business development could help by ensuring timely access to capital
resources and funding.
Admittedly, central government cannot enforce all types of
FAVOUR TECHNOLOGICAL
ADVANCEMENT
legislation, but it can show leadership and encourage buy-in for
Unsurprisingly, Croatia has not yet been able to embrace the full potential
legislation by regional and local governments. Special incentives should
of technology. The World Travel & Tourism Competitiveness Monitor
also be proposed for the rapid modernization and upgrading of Croatia’s
illustrates the country’s level of progress in terms of modern technological
rural areas in order to spread the benefits of Travel & Tourism across
systems and infrastructure, the use of data regarding telephone mainlines,
the country.
mobile phones, high technology exports and Internet hosts.According to
Experience has shown that investment – whether foreign or
the Monitor, Croatia has an Index Value of 22, where zero is given to the
domestic – is extremely sensitive to economic changes.To guard against
country with the lowest performance and 100 to countries with the best
this, continued efforts need to be made, through the development of
score.This rating ranks Croatia in 64th position among the 206 countries
incentive schemes, to attract sustained capital investment in the
surveyed. As a technology intensive industry, Travel & Tourism can help
country’s Travel & Tourism industry from domestic and foreign sources.
Croatia obtain and apply information technology systems and
At the same time, however, it is important to guard against the
telecommunications at a competitive pace.
dangers of excessive development that bears no relation to existing or
Index Value
Ranking
projected demand.This can result in cut-throat competition, leading to
Austria
declining operating performances and lower profits.
France
58.18
19
Italy
53.85
26
Greece
47.45
31
Spain
38.89
40
Croatia
22.00
64
Turkey
19.23
67
59.59
18
Source:World Travel & Tourism Competitiveness Monitor, 2002
Telecommunications
An increasing share of Travel & Tourism operations – and virtually all
distribution and sales transactions – flow through telecommunications
circuits.Where telecommunications are monopoly controlled, there are
often restrictions on access, high costs and unreasonable operating
conditions. This in turn limits the potential of market-oriented
expansion of Travel & Tourism, with negative impacts domestically and
internationally in terms of cost, operational efficiency and customer
service.
WTTC recommends that the Croatian Government continue
pursuing its policy of open telecommunications markets, which will help
to lower costs and enhance services for travellers and tourism companies.
44
E-Marketing and Distribution
The Law on Environmental Protection, established in 1994,
In today’s increasingly competitive global marketplace, there is a real need
commits the Croatian Government to developing environmental
for a strong national leadership branding which optimizes resources,
strategies and programmes and detailing these, together with guidelines,
focuses the myriad of interests – public and private sector, national,
in reports. It is important that government plans highlight positive case
regional and local – and attracts the attention of travellers. This will
studies and deliver a manual for implementation. Procedures and
require particular emphasis on a coordinated approach to Internet
guidelines should be communicated to all stakeholders and implemented
marketing and distribution to optimize Croatia’s visibility.
as widely and as quickly as possible. Implementation of these procedures
The Croatian National Tourist Board has already taken the lead in
and their impact should also be closely monitored.
developing a national tourism e-business for Croatia.This new strategy is
Education and awareness are two of the best tools for the
centred on a newly designed website and national database, collectively
development of responsible tourism – at the social, economic and
providing an interactive one-stop information shop for potential travellers
environmental levels. The Croatian Government should accelerate its
to Croatia.
efforts to build these concepts into the education system, promoting the
Experience in other countries around the world has shown that,
while public sector support for national destination databases is critical,
economic, social and environmental benefits of sustainable Travel &
Tourism development.
the operation and marketing of these databases are best left to the private
Local campaigns can add impetus to national efforts. Last year the
sector. Best-practice models include Ireland,Austria and the Netherlands.
Croatian National Tourist Board ran an exemplary campaign under the
The central and regional governments of Croatia should provide support
theme ‘I love Croatia’.The objectives of the campaign were to enhance
for local companies so that they can promote and distribute their
the general appearance of Croatian tourism areas and improve the
products through the website, as well as developing access to other
satisfaction levels of tourists. Media attention was drawn to the
technology advances.This will help them compete more effectively with
presentation of the award ‘Tourist Flower of 2002’ to the most successful
foreign-owned companies in Croatia and with suppliers in competing
participant. The campaign helped to enhance the quality of the
destinations.
environment in many local regions and to inject a sense of pride among
the local population in the participating towns and villages.
Sustainability will need a balance of private initiative, economic
incentives and regulation. Global principles should be reflected in local
PROMOTE RESPONSIBILITY IN
NATURAL, SOCIAL AND CULTURAL
ENVIRONMENTS
action and market-based delivery mechanisms should be encouraged.
Establish Clear Procedures and Guidelines
across the industry as a whole, and not just as a policy for rural and
Travel & Tourism destinations increasingly recognize that their
nature-based tourism.
Pilot projects should be used to evaluate and demonstrate local
sustainability. It is important for sustainability to be accepted as a policy
competitiveness in the medium to longer term depends not only on the
One very clear and practical example of this is the Blue Flag
provision of high quality services at competitive prices, but also on
programme.This initiative involves a prestigious annual award to beaches
whether this occurs in a sustainable way – in harmony with the local
that conform to international standards such as environmental and
environment and local communities. According to the World Travel &
tourist friendliness, cleanliness and visible security. Croatia has been
Tourism Competitiveness Monitor, Croatia is fairly well positioned in
successful in attaining the Blue Flag for many of its beaches.
comparison with the other 205 countries featured in the Monitor,
ranked as number 34. This score indicates that the Croatian
Government’s awareness towards environmental aspects of development
is fairly high. This rating also takes into account current levels of CO2
emissions and the ratification of environmental treaties.
As the number of people within a given area increases, so too does
Croatia boasts several examples of worldclass natural and cultural resources that
have been awarded World Heritage Site
designation
the pressure placed on the local environment and community. Planning
to the long-term success of Travel & Tourism. Important areas for
Increase Branding through International
and/or National Designations
consideration by the central and local governments in Croatia include
Croatia boasts several examples of world-class natural and cultural
consumption, waste and resource utilization.
resources that have been awarded World Heritage Site designation, such
to meet this growth in a sustainable fashion is fundamentally important
Croatia’s well-preserved cultural and natural environments are the
as the Old City of Dubrovnik, Split, Trogir and the Plitvice Lakes. The
country’s biggest tourism assets. In the past, a high level of environmental
Croatian Government should also consider developing and promoting a
consciousness has helped Croatia develop Travel & Tourism in a
national heritage designation, with clearly defined criteria to support
sustainable way. The Croatian constitution places the environment as a
quality. Such a designation should be accompanied by increased
whole – particularly the sea and coastal areas, the islands, flora, fauna and
government funding for the development and promotion of identified
cultural monuments – under the special protection of the government.
areas of particular heritage value. A focus on national and international
This has helped Croatia preserve much of the natural beauty on which
designations will assist Croatia’s development of their new brand,
its Travel & Tourism industry so heavily relies.
‘Croatia – the Mediterranean as it once was’.
45
SATELLITE ACCOUNT
1998
1999
2000
2001
2002E
2003E
2013P
Croatia Travel & Tourism - Kn mn
Business Travel & Tourism
Corporate
Government
Gov't Expenditures - Individual
Visitor Exports
7,613.80
2,242.60
1,480.10
762.49
116.36
17,927.00
7,519.30
3,696.60
2,439.80
1,256.80
141.29
18,136.00
8,819.80
2,916.10
1,924.60
991.47
117.34
23,465.00
9,165.40
3,261.30
2,152.50
1,108.80
34.57
28,681.00
11,296.60
3,617.40
2,362.23
1,255.17
41.38
30,622.60
12,598.00
3,922.91
2,559.68
1,363.23
53.58
35,474.90
31,106.80
7,293.89
4,977.97
2,315.92
108.59
93,693.70
27,900.00
29,493.00
35,318.00
41,142.00
45,577.90
52,049.40
132,203.00
Gov't Expenditures - Collective
Capital Investment
Exports (Non-Visitor)
1,054.00
5,501.80
2,369.50
990.15
5,214.40
2,713.40
1,002.90
5,075.70
3,502.30
254.78
4,914.10
3,515.80
318.45
4,726.73
3,529.85
412.34
4,921.25
4,101.95
835.70
10,635.30
12,735.60
36,825.00
38,411.00
44,899.00
49,827.00
54,153.00
61,485.00
156,410.00
122.59
10,390.00
119.71
13,246.00
131.68
15,970.00
128.75
16,910.60
138.97
19,664.70
200.07
52,239.10
Travel & Tourism Economy Aggregates (Direct and Indirect Impact)
Employment ('000)
293.78
291.28
GDP
24,978.00
25,088.00
283.90
30,285.00
282.52
33,819.00
275.32
36,000.00
294.06
41,609.90
427.38
111,590.00
9.22
2.88
15.79
36.18
19.13
9.84
2.81
15.25
37.68
18.40
9.37
0.75
13.19
40.11
17.93
10.62
0.92
11.61
40.22
18.70
11.02
1.15
11.06
43.83
19.09
15.55
1.38
10.69
56.23
22.03
11.54
7.34
11.59
8.68
12.72
9.80
12.27
9.76
12.95
10.58
15.86
14.80
Employment
27.72
27.43
GDP
18.15
17.72
27.48
19.86
27.30
20.76
26.24
20.78
27.41
22.39
33.88
31.62
1.31
9.03
20.09
8.08
8.60
5.60
6.57
3.58
-74.82
-5.61
19.16
-2.13
13.57
8.19
21.18
-6.27
4.04
-2.17
7.95
5.90
26.09
1.39
12.81
13.16
11.21
10.56
4.53
4.03
7.32
7.50
6.88
6.89
Travel & Tourism Industry Aggregates (Direct Impact Only)
Employment ('000)
123.76
GDP
10,270.00
Note: Employment in ‘000 Jobs
T&T Accounts as % of National Accounts
Gov't Expenditures
Capital Investment
Exports
T&T Imports
9.39
3.19
17.16
37.40
17.67
Employment
11.68
GDP
7.46
Travel & Tourism Real Growth (% per annum, except 2013 = 10-year annualized)
-3.25
-4.42
12.60
-13.48
59.52
-24.27
Gov't Expenditures
Capital Investment
Visitor Exports
Other Exports
46
10.06
21.94
1.28
1.60
-1.28
2.10
-6.44
-8.28
-2.09
10.82
2.31
0.95
-4.95
-6.55
24.21
23.91
14.96
12.21
TABLES
1998
GDP
3.22
Employment
6.43
1999
2000
2001
2002E
2003E
2013P
-2.09
-0.95
22.39
-2.35
17.54
10.00
3.18
-2.22
13.24
7.94
7.38
3.73
GDP
8.90
-2.80
Employment
0.21
-1.04
15.88
0.20
8.87
-0.49
3.73
-2.55
12.55
6.81
7.48
3.83
Croatia Travel & Tourism - US$ mn
Corporate
Government
Visitor Exports
1,196.70
352.49
232.64
119.85
18.29
2,817.70
1,057.20
519.74
343.03
176.71
19.87
2,549.90
1,065.60
352.33
232.54
119.79
14.18
2,835.10
1,099.00
391.05
258.09
132.96
4.15
3,439.00
1,457.62
466.76
304.80
161.96
5.34
3,951.30
1,625.55
506.18
330.28
175.90
6.91
4,577.41
4,013.79
941.15
642.32
298.83
14.01
12,089.50
4,385.20
4,146.70
4,267.20
4,933.10
5,881.03
6,716.06
17,058.50
Capital Investment
165.67
864.76
372.43
139.21
733.14
381.50
121.17
613.26
423.16
30.55
589.22
421.56
41.09
609.90
455.46
53.21
635.00
529.28
107.83
1,372.30
1,643.30
5,788.10
5,400.60
5,424.80
5,974.40
6,987.48
7,933.55
20,181.90
Employment ('000)
123.76
GDP
1,614.20
122.59
119.71
131.68
128.75
138.97
200.07
1,460.80
1,600.40
1,914.90
2,182.01
2,537.38
6,740.53
Travel & Tourism Economy Aggregates (Direct and Indirect Impacts)
Employment ('000)
293.78
291.28
GDP
3,926.00
3,527.40
283.90
3,659.10
282.52
4,055.10
275.32
4,645.17
294.06
5,369.02
427.38
14,398.70
Travel & Tourism - 1990 Constant US$ mn
1,150.70
338.94
17.59
Visitor Exports
2,709.40
4,216.60
159.30
Capital Investment
831.51
358.12
5,565.50
1,099.80
540.68
20.67
2,652.70
4,313.80
144.82
762.68
396.87
5,618.20
1,238.40
409.46
16.48
3,294.80
4,959.10
140.82
712.70
491.77
6,304.40
1,254.70
446.44
4.73
3,926.10
5,632.00
34.88
672.69
481.28
6,820.80
1,506.83
482.52
5.52
4,084.69
6,079.56
42.48
630.49
470.84
7,223.36
1,636.38
509.55
6.96
4,607.90
6,760.80
53.56
639.23
532.81
7,986.40
3,089.93
724.52
10.79
9,306.86
13,132.10
83.01
1,056.44
1,265.06
15,536.60
GDP
Travel & Tourism Industry
Travel & Tourism Economy
1,519.70
3,669.50
1,859.90
4,252.40
2,186.10
4,629.50
2,255.67
4,801.98
2,554.29
5,404.79
5,189.06
11,084.50
1,552.10
3,775.10
47
WTTC would like to express its appreciation to the
following organizations that contributed their
knowledge, insight and data/information to the policy
review effort included in this report.
Atlas Airtours
Atlas Travel Agency
Croatia Airlines
Croatian National Tourist Board
Croatian Ministry of Tourism
Croatian Bureau of Statistics
DEG, German Investment & Development Company
Ekonomski Fakultet, Zagreb
Faculty of Tourism Hospitality & Management
Fakultet Za Turistički, Opatija
Gulliver Travel Agency, Dubrovnik
Hotel Esplanade, Zagreb
Hotelijerski Fakultet
Horwath & Horwath Consulting
Institute for Tourism, Croatia
Kompas Zagreb
Pucić Palace, Dubrovnik
Republic of Croatia, Region of Istria
Sol Meliá Croatia Ltd
THR International Tourism Consultancy
TZ Żupanija Istarska
TZ Żupanije Primorsko-goranske
UHPA, Association of Croatian Travel Agencies
Zagreb Convention Bureau

CROATIA

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