The global financial crisis, which started in 2007 as the collapse of the US housing market, destabilized the global economy, thus diminishing the inflow of foreign investments in numerous countries around the world and affecting numerous industries, including tourism.
As for Croatia, tourism was a major “breadwinner” for the country’s economy until the breakup of Yugoslavia in 1990. The civil war almost destroyed Croatia’s tourist infrastructure. It has been recovering since 1997. Croatia is getting more and more popular with tourists…
Tips for investors: Croatia’s present-day tourism
According to Eugene Olkhovsky, ’s leading expert, Croatian resorts have been some of Europe’s most visited places in the last few years. The profits gained by Croatian tourist businesses confirm this: 2009 — €6,3B, в 2010г — €6,7B, в 2011 — some €7B. In 2012 the gains are expected to increase due to new investments and infrastructure development.
Why does Croatia keep attracting tourists from around the world?
First of all, it is one of the cheapest tourist zones in the Mediterranean coast. Entertainment, souvenirs, alcoholic beverages, food, transportation costs, hotels, excursions – everything is cheaper.
Over 12 million tourists visit Croatia every year. Where do they come from? The following chart shows that:
Another factor is Croatia’s beautiful nature, delicious national cuisine and lots of tourist sites, including ancient castles and museums.
The Croatians have officially voted for EU membership. How will it influence the country’s tourist industry? A couple of years ago 30.000 EU citizens were asked the following question: “Where do you prefer to take your vacation?” For most respondents it was Croatia.
Let’s have a look at how popular Croatia was with foreign tourists during the period of 1999-2010:
Will EU membership help Croatia to attract more investments for its tourist industry?
According to Eugene Olkhovsky, EU membership will most likely expand the investment inflow. Moreover, it may contribute to the expansion of tourist wave from EU countries as European tourists will no longer need Schengen visas to visit the country.
Not so long ago «The Guardian» recognized Croatia the 4th most popular country for UK tourists. Croatia is the 3rd most popular resort for tourists from Poland, Czech Republic, Norway, Hungary, Slovakia and Slovenia.
This year «National Geographic Traveler» has included Croatia’s biggest peninsula called Istra in the list of the world’s most popular and beautiful resorts.
Investing in Croatia: fixed property, banks, manufacturing production
In 2005 the Croatian authorities started selling small islands to well-off individuals. However, later they banned any construction works on small, inhabited islands, which cooled investors’ interest in Croatia’s land and fixed property.
There are suppositions that after entering the EU, the ban will be changed by some strict limitations. It should be noted that in this case there will be plenty of persons interested in buying islands despite the fact that the authorities are planning significant price hikes.
Considering the possibility of purchasing urban or coastal fixed property, most investors are still waiting for a 10% decline in 2012. New homes remain unclaimed. Some investors keep monitoring the situation. They say the prices will soar only in 2013.
According to Croatia’s central bank, in January-July 2011 the inflow of foreign investments nearly doubled, thus reaching $485.3M. American are the most numerous investors. Austrians and Germans come 2nd and 3rd correspondingly.
On March 1st 2013 Croatia will become another EU member. However, it is likely that the tourist traffic from non-EU states will decline as tourists from those states will have to obtain Schengen visas to visit Croatia.
However, most European airlines are planning to start new scheduled flights to Croatia. For example, Stockholm – Dubrovnik , Copenhagen – Dubrovnik, Helsinki – Dubrovnik, Newcastle – Dubrovnik etc.
Despite some negative factors (like corruption scandals), low prices, beautiful nature and other positive factors outweigh them. European tourists still want to visit Croatia, especially as the Croatian authorities are doing their best to increase the country’s attractiveness both for tourists and investors.
Croatian Kuna: Market Outlook
According to , USDHNK is being traded in the 5,6862-5,8505 range. A break and consolidation above the top of the rage will probably suggest another rally – wave C. The closest levels of resistance is 5,8888. Once the bottom of the rage is overcome, the price will start forming a “shortened” wave C or a(C ), which will be confirmed by a downward FZR.
Market Leader and would appreciate if you could participate in a survey. Please, visit the Academy’s forum for traders and investors and answer the following question:
Will Croatia manage to become a major European tourist center in the near future?
