Thursday, 25 November 2021

Stronger Seasonal Tourism Results in Less Fast-Growing Croatian Companies

November the 25th, 2021 - Fast-growing Croatian companies are few and far between in areas of the country where seasonal trends are the strongest, which shouldn't come as much of a shock to most.

As Poslovni Dnevnik/Jadranka Dozan writes, demand for travel across Europe has shown a solid recovery this past summer, although according to the latest quarterly report on trends and prospects, a return to pre-pandemic levels is still not expected before 2024.

Judging by this year's achievements of the tourism sector here in Croatia, this seems likely that this recovery will occur much earlier on, especially in relation to competing countries with which we usually compare ourselves across the Mediterranean.

While announcing the continued recovery of the travel industry for next year, it is generally warned that the increase in international travel costs could adversely affect travel availability itself, the Zagreb Institute of Economics continues to analyse some of the broader effects and aspects of Croatia's high reliance on tourism as part of the TourCro project.

In a paper recently published in the Tourism Management journal, Maruska Vizek from EIZ and Nebojsa Stojcic from the University of Dubrovnik and Josip Mikulic from the Faculty of Economics in Zagreb all analysed how tourism activity affects the emergence of fast-growing Croatian companies in local government units across the country.

In short, the results of this analysis suggest that both the vulnerability of local government units to tourism activity and the increased seasonality of tourism has negatively affected the emergence of fast-growing Croatian companies. This aspect is important because of the importance of fast-growing Croatian companies in terms of overall economic activity.

According to the OECD definition, fast-growing Croatian companies are those that achieve sales revenue growth of at least 20 percent within three years and had at least ten employees at the beginning of the observed three-year period, and according to some research are responsible for creating 50 percent of all new jobs and revenues in the service sector, recalls Vizek in a comment on the Institute's website regarding the results of the said analysis.

Fast-growing Croatian companies cause, he says, positive ups and downs of spillovers within the value-added chain to which they belong, and are often in sectors characterised by the high-intensity application of knowledge and technology.

He also explained how the empirical analysis in the paper has been conducted at the level of local self-government units from 2012 to 2019, where the subject of the analysis is the population of more than 100,000 companies (legal entities) registered in the country in that period. Tourist activities are presented in two ways: as an index of vulnerability to tourism of local self-government units and as the intensity of the seasonality of tourist activities in these same local units.

“The negative impact of increased seasonality of tourism in local units on the emergence of fast-growing Croatian companies is reflected in the finding that increasing the seasonality of tourism by 10 index points leads to a decrease in the share of fast-growing Croatian companies in terms of total companies by 3 to 6 percentage points.

At the same time, an increase in the tourism vulnerability index of 10 index points reduces the share of fast-growing Croatian companies by 0.6 to 1.5 percentage points on average,'' said the assistant director of the Institute of Economics in her review. In other words, he says, both greater vulnerability to tourism and the more pronounced seasonality of tourism in local government units is associated with a decrease in the share of fast-growing Croatian companies in the total number of companies which exist within local units.

For more, make sure to check out our dedicated business section.

Monday, 8 February 2021

Tourism4All Promotes Accessible Tourism and Season Prolongation

February 8, 2021 – As part of the Tourism4All project funded through the Interreg Italy-Croatia program, a workshop on the accessibility of tourist facilities for people with special needs and the season prolongation will be held in Zadar.

The City of Zadar is a partner in the Tourism4All project funded through the Interreg Italy-Croatia program. The project aims to develop and promote a cross-border network of accessible tourist destinations. Also, it seeks to design a common approach and methodology for the development of new tourism products focused on people with special needs, as well as to extend the tourist season.

The interest of people with disabilities and people older than 65 in traveling is continuously growing, and this segment of the tourist market has vast underutilized potential. One of the activities of the Tourism4all project is the education of employees in the tourism and cultural sector about accessible tourism.

The workshop "Accessible Tourism and Market Potentials" will be held online on Thursday, February 11, 2021, from 11 am to 12 pm. The workshop will be led by Josip Milić, Head of the Department for Preparation and Implementation of EU Projects in the City of Zadar. Ana Perica and Josip Milković from the Association of the Blind of Zadar County will also join.

With the Tourism4All project, by improving the accessibility of natural and cultural sights of selected destinations and promoting new tourist services, the social inclusion of disadvantaged or people with special needs (disabilities, the elderly) will be encouraged. Also, the project intends to reduce tourism seasonality.

The project seeks to increase the availability of tourist products and services in selected destinations with exceptional natural and cultural heritage in Croatia and Italy.

Activities include developing a common methodology, capacity building, growth of competencies in the accessible tourism sector, networking, knowledge transfer, development of new services, preparation and implementation of joint tourism promotion of involved destinations.

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Wednesday, 8 January 2020

Croatia is European Record Holder for Seasonality, Overtaking Greece

Croatia is the only country in all of Europe, and not just the EU, which fails miserably in achieving even 1 percent of its annual tourist traffic during the winter months of January and February.

As Poslovni Dnevnik/Marija Crnjak writes on the 8th of January, 2020, despite years of efforts to extend the tourist season, either with good ideas or simply bizarre schemes, Croatia still has by far the highest seasonality of tourist traffic of all European countries, this also includes non-EU countries.

The just released Eurostat report based on overnight stays in 2018 showed that Croatia has the most pronounced seasonality curve, with as much as 59 percent of total tourist traffic realised in just two months - July and August, which is as much as fifteen percent higher than the next countries on the list - Bulgaria and neighbouring Montenegro.

Croatia is the only country in all of Europe (as a continent, not necessarily as a bloc) that fails to generate even one percent of its annual traffic in January and February, and even Greece, a destination that also has longstanding and enormous seasonality problems, is faring better than Croatia. As is well known, the problem of seasonality has an impact on tourism revenue and pricing policy, as well as on the profitability of investments in tourist facilities, infrastructure and accommodation.

The seasonality in Croatia is mostly influenced by the structure of its accommodation capacities, with by far the largest share of beds in private accommodation (as much as 37 percent of it) and only 10.2 percent of beds in hotels. At the same time, according to the Tourism Impulse publication of the Croatian Tourism Association, the annual average occupancy rate for hotels in 2018 stood at 43.2 percent and family/private accommodation at only 18.9 percent, with these figures slightly decreasing last year.

At the European level, August is the strongest month, with 3.5 times more overnight stays realised than in January. Back in August 2018, Croatia generated almost a third of its annual turnover, as much as 30.2 percent of nearly 90 million overnight stays. In the month with the worst traffic, February, Croatia realised a worrying 55 times less overnight stays than it did in August.

When it comes to Mediterranean countries, which Croatia can be better compared with than with Northern European countries such as the United Kingdom and Norway, who have strong economies that rely on far more than just tourism, behind Montenegro, Bulgaria and Greece come France and Italy with a total of 36 percent of their tourist traffic realised in July and August.

Spain, the southwestern European country which has always been a hit with primarily Northern European tourists, acheives 28 percent of the annual share of its overnight stays in July and August. Malta stands out from the trend of the Mediterranean countries as one of the countries with the most even occupancy rate throughout the year. In addition to Malta come the Czech Republic, Germany, Estonia, Poland, Finland, as well as Kosovo, all of which don't rely that heavily on summer tourism.

Greece recorded a significant eighteen times fewer overnight stays during its worst month, which is also January, than it did during the height of the Greek tourist season - August. The Alpine countries, Austria, Liechtenstein and Switzerland stand out from the rest of Europe, as all of them have two peak seasons, summer and winter.

Make sure to follow our dedicated travel page for more.