George Dutchev: 'Tourism in the Balkans: Slump or Rise?'
Thursday 30 October 2008 at 14:40
George Dutchev is the Editor-In-Chief of Property Xpress, an online service providing daily news on South East Europe, Ukraine and Russia.
Despite being close to each other, Balkan countries have a number of differences in terms of tourism development and perspectives. From the well-developed Greece and Turkey, to emerging Bulgaria, Croatia and Romania to the “rising stars” Montenegro and Albania, forces driving the development of each of these markets are all different, varying from sunny coastlines and snowy mountains to business trips.
Besides the mature markets of Greece and Turkey, where trends in tourism have been established for years, today, the tourist destination picture is ‘multi-colored’, due to political and economic processes. New EU members Bulgaria and Romania make the most from both their picturesque scenery and increasing number of business travelers. After separating from the Former Yugoslavia, Croatia and Montenegro appeared as attractive destinations with a number of large-scale tourism projects – some under construction and some still in the pipeline.
Despite positive signs, the main question for Balkans tourism, as everywhere in the world is; will the international slump hit the market… or will the market defeat it?
In recent years, Romania registered a stable increase in the number of foreign visitors arriving in the country. Figures from market research showed a 28 pct increase for 2007, up from six mln in 2006 to 7.7 mln in the next year. According to the World Travel & Tourism Council in 2008, Direct Industry GDP will be 8.1 pct and the tourism share in GDP will reach 2.2 pct or 3.6 billion dollars (2.9 billion Euro). (2006) Most foreigners travelling to Romania are on business, but it is expected that a greater number will come for leisure in the future, as Romania has significant leisure potential.
In a likely scenario, the international slump could bring some positives to Bulgaria, according to Roumen Draganov, Director of the Bulgarian Institute of Analyses and Assessments of Tourism. This year’s figures show that visitors coming to the country have increased by 17 pct to 5.8 mln. (end of August) compared to 8,2 pct growth for the whole 2007. Why? Because until recently, Bulgaria has been known as a budget destination, attracting mid to low-yield tourists, not expected to be affected by the crunch unlike high-yield tourists. On the other side, the tourism boom in the recent years resulted in the development of hundreds of hotels, some of which now suffer from saturation in the sector. Where are the niches? Roumen Draganov says, there are niches in spa and health with relevant preliminary feasibility study as well as in the hotels, built in big cities but only under the umbrella of a recognized international chain.
The government in Serbia has accepted a plan through which 2.8 bln. euro will be invested in tourism until 2015. Money will be spent to develop the tourist area in the Serbian part of Balkan Mountain as well as for development of a tourist complex around Lake Palich. In recent years, Serbian tourism has showed encouraging results. For instance, in 2007, 690,000 tourists visited the country; a 48 pct increase compared to the previous year. Hotels in the big cities recorded 30 pct increase or 348 mln euro in 2007. In 2008, there was a successful privatization, leading to revitalizing 310 hotels with more than 112,000 beds.
The hospitality industry in Croatia has shown strong figures in early 2008. In the period January to February 2008, the number of tourist nights totaled around 730,000 (domestic and foreign), up a strong 13% y-o-y, according to a report by Business Monitor International. The top four foreign markets, Germany, Italy, Slovenia and the Czech Republic, all recorded strong growth. However, due to the slowing in the global economy for 2008-2009, there are some signs that this will affect Croatia through lower growth in tourism revenues. Growth is nevertheless expected to rebound strongly in 2011-2012 with the expected EU accession.
Export earnings from international visitors and tourism goods in Montenegro are expected to generate 37.9% of total exports (EUR529.9 mln) in 2008, growing (nominal terms) to EUR 1,887.4 mln (46.8% of total) in 2018. Real GDP growth for travel & tourism economy is expected to be 17.0% in 2008 and to average 5.6% per annum over the coming 10 years. However, rising prices are contributing to a slowdown in Montenegro’s tourism boom, Balkan insight reports. The head of the Tourist Agencies Association in the coastal town of Budva said, quoted by Balkan insight, the “first problem was the 20-30 percent price increase in June in both hotel and private accommodation compared to last year.”
Despite being close to each other, Balkan countries have a number of differences in terms of tourism development and perspectives. From the well-developed Greece and Turkey, to emerging Bulgaria, Croatia and Romania to the “rising stars” Montenegro and Albania, forces driving the development of each of these markets are all different, varying from sunny coastlines and snowy mountains to business trips.
Besides the mature markets of Greece and Turkey, where trends in tourism have been established for years, today, the tourist destination picture is ‘multi-colored’, due to political and economic processes. New EU members Bulgaria and Romania make the most from both their picturesque scenery and increasing number of business travelers. After separating from the Former Yugoslavia, Croatia and Montenegro appeared as attractive destinations with a number of large-scale tourism projects – some under construction and some still in the pipeline.
Despite positive signs, the main question for Balkans tourism, as everywhere in the world is; will the international slump hit the market… or will the market defeat it?
In recent years, Romania registered a stable increase in the number of foreign visitors arriving in the country. Figures from market research showed a 28 pct increase for 2007, up from six mln in 2006 to 7.7 mln in the next year. According to the World Travel & Tourism Council in 2008, Direct Industry GDP will be 8.1 pct and the tourism share in GDP will reach 2.2 pct or 3.6 billion dollars (2.9 billion Euro). (2006) Most foreigners travelling to Romania are on business, but it is expected that a greater number will come for leisure in the future, as Romania has significant leisure potential.
In a likely scenario, the international slump could bring some positives to Bulgaria, according to Roumen Draganov, Director of the Bulgarian Institute of Analyses and Assessments of Tourism. This year’s figures show that visitors coming to the country have increased by 17 pct to 5.8 mln. (end of August) compared to 8,2 pct growth for the whole 2007. Why? Because until recently, Bulgaria has been known as a budget destination, attracting mid to low-yield tourists, not expected to be affected by the crunch unlike high-yield tourists. On the other side, the tourism boom in the recent years resulted in the development of hundreds of hotels, some of which now suffer from saturation in the sector. Where are the niches? Roumen Draganov says, there are niches in spa and health with relevant preliminary feasibility study as well as in the hotels, built in big cities but only under the umbrella of a recognized international chain.
The government in Serbia has accepted a plan through which 2.8 bln. euro will be invested in tourism until 2015. Money will be spent to develop the tourist area in the Serbian part of Balkan Mountain as well as for development of a tourist complex around Lake Palich. In recent years, Serbian tourism has showed encouraging results. For instance, in 2007, 690,000 tourists visited the country; a 48 pct increase compared to the previous year. Hotels in the big cities recorded 30 pct increase or 348 mln euro in 2007. In 2008, there was a successful privatization, leading to revitalizing 310 hotels with more than 112,000 beds.
The hospitality industry in Croatia has shown strong figures in early 2008. In the period January to February 2008, the number of tourist nights totaled around 730,000 (domestic and foreign), up a strong 13% y-o-y, according to a report by Business Monitor International. The top four foreign markets, Germany, Italy, Slovenia and the Czech Republic, all recorded strong growth. However, due to the slowing in the global economy for 2008-2009, there are some signs that this will affect Croatia through lower growth in tourism revenues. Growth is nevertheless expected to rebound strongly in 2011-2012 with the expected EU accession.
Export earnings from international visitors and tourism goods in Montenegro are expected to generate 37.9% of total exports (EUR529.9 mln) in 2008, growing (nominal terms) to EUR 1,887.4 mln (46.8% of total) in 2018. Real GDP growth for travel & tourism economy is expected to be 17.0% in 2008 and to average 5.6% per annum over the coming 10 years. However, rising prices are contributing to a slowdown in Montenegro’s tourism boom, Balkan insight reports. The head of the Tourist Agencies Association in the coastal town of Budva said, quoted by Balkan insight, the “first problem was the 20-30 percent price increase in June in both hotel and private accommodation compared to last year.”