Croatia is becoming one of the most expensive tourist countries: The end of the former holiday paradise

Word is spreading throughout Europe that Croatia is becoming one of the most expensive tourist countries, Croatian media write.

"Explosion of prices in Croatia. Why are prices rising in Croatia? And accommodation, food and everything else will be expensive. We bring you all the information about the explosion of prices in Croatia," the portal says Croati.de.

It is a portal that has been following Croatia for 20 years, it is a central place for Germans and Austrians looking for accommodation and entertainment in Croatia, reports Free Dalmatia.

They also launched a survey on the TikTok channel Kroati.de and asked the question "Has Croatia become more expensive?". Almost 700 people participated in the survey, and 81 percent answered "yes" and 19 percent answered "no".

"Prices in Croatia have been rising for a long time and there is no end in sight. Locals are already alarming that everyday things such as groceries and restaurant prices are difficult to afford. Tourists vacationing in Croatia are sometimes surprised and annoyed by further price increases," they say.

In recent weeks, numerous headlines such as "Tourists shocked by prices - now reactions follow", "Croatia: yesterday was a vacation paradise - this is how it got more expensive" or "Expensive club shocked Croatian holidaymakers" and similar published content in the media pointing to price increases in Croatia.

Tourists are shocked by the development of prices and talk about the end of the former holiday paradise.

But what is actually behind it?

Yes, it is true that Croatia has become more and more expensive as a popular tourist destination in recent years, according to the German portal. The prices of food, services and the like have been rising for months, and there is no end in sight to the price increases.

Politicians deny that the introduction of the euro is to blame for this, but if you look closely, there are actually several factors that contributed to this development.

The Croatian economy continues to struggle with the ongoing energy crisis, as well as inflation, which reached a peak of 13,5 percent in November 2022, which inevitably led to an overall increase in prices.

There is the currency switch to the euro on January 1, 2023, which came at the worst possible time. However, the Croatian Government is working on developing strategies to solve these challenges and ensure economic and price stability.

So they described the situation by chapter:

Rising accommodation prices

In 2023, many owners and renters of holiday apartments in Croatia have significantly increased accommodation prices. This price increase was justified by the fact that ubiquitous inflation and increased business costs due to the energy crisis and the increase in the wages of cleaners led to further price increases.

The planned transition from the Croatian kuna to the euro was used as an additional opportunity to increase prices as desired. In some cases, accommodation was charged up to 50 percent more compared to the previous year, without a noticeable improvement in service.

It should also be noted that the months of July and August last year (2022) were considered the supposed end of the corona pandemic, and the regained freedom of travel meant that both months were fully booked. Due to the high expectations of renters, this led to the mentioned price policy.

This sudden correction of prices and the development of events caused surprise and justified indignation of many tourists. Although there were good bookings for the peak season in the first months of 2023, the skyrocketing prices led to a flood of cancellations. In response, many landlords have again sharply reduced accommodation prices at short notice to close booking gaps.

Food price increase

Prices have also increased in Croatian supermarkets. If you compare prices, you quickly realize that many foods are much more expensive than in Germany or Austria.

In 2022 and 2023, Croatia experienced a worrying rise in food prices, which took a heavy toll on both consumers and the country's economy.

These price increases were caused, among other things, by the increase in energy and transportation costs, which led to an increase in production and delivery costs and were ultimately passed on directly to consumers.

Increased fuel and energy costs have also had a negative impact on the entire food supply chain. This is why food prices in Croatia have reached similar or even higher levels than in neighboring countries.

Average prices in bakeries, for example, rose by about 15 percent. A similar development is visible in the retail sector, where products such as milk, chicken meat and beer have grown by around 17 percent on average.

There is clearly a noticeable rise in vegetable prices, with some varieties being hit hard. Kale grew by 188 percent, red onions by 95 percent, lemons by 90 percent, oranges by 89 percent, apples by 86 percent, and carrots by 80 percent.

While fuel prices are among the lowest in the region due to government restrictions, imported products in particular are struggling with large price increases.

First of all, it affects the daily life of local residents and is a challenge for many household budgets. However, the government has taken countermeasures against inflation, including subsidies and support to farmers, price controls and encouragement of local production. There are currently signs of a slight easing as the prices of certain commodities such as sugar, oil and grains are falling again, which gives hope for the future.

The explosion of prices in restaurants

In 2022 and 2023, Croatian gastronomy will see significant price increases, which were noticeable in both food and drinks.

"Regular" restaurants as well as fancy establishments were equally affected by this trend. The cost of lunch or dinner in some places has increased by about 20 to 25 percent compared to the previous year. Even everyday beverages such as coffee and alcoholic beverages saw an increase of up to 25 percent.

The reasons for price increases in the hospitality industry are complex. In addition to investment in infrastructure, the growth of raw material prices, food price hikes and inflation also play a decisive role.

In addition, the Government's measures to improve working conditions and increase the minimum wage increased the cost of doing business. Some linked the inflation to the switch from the Croatian kuna to the euro, but the Government strongly denied that claim.

Unfortunately, the currency change also led to isolated illegal and hidden price adjustments by caterers. Despite the legal consequences and harsh penalties, the supervision of all catering facilities is extremely difficult in practice.

This has led to disproportionate price increases and arbitrary pricing. This development of events caused confusion and astonishment in the country and abroad. Examples like one scoop of ice cream for five euros in Dubrovnik, a hamburger for 22 euros in Rovinj, or an Aperol Spritz of 1 deciliter for 11 euros in Šibenik made everyone shake their heads.

Visiting a restaurant today is a rare luxury experience for many locals due to the pricing policy. As a result, most restaurants in tourist areas limit their opening hours to the summer months, which in turn affects prices.

While some companies have benefited from higher prices in the short term, many consumers are still struggling to keep up with the increased costs.

Consequences for tourism

The future development of tourism in Croatia will be significantly affected by the movement of prices in the country. This is undoubtedly one of the most important challenges for the tourism sector. The possibility of further unpredictable price growth, not only due to the limited purchasing power of the local population, could lead to the departure of more qualified experts from the country, which would have serious consequences.

However, for the further affirmation of Croatia as an attractive tourist destination, it is of crucial importance not only to maintain a balanced price policy, but also to continuously invest in improving the tourist infrastructure.

Modernization of accommodation, well-developed roads and sustainable leisure activities not only contribute to passenger service, but also serve to protect and preserve the country's natural resources and beauty.

These steps are key to maintaining Croatia's long-term competitiveness compared to other popular destinations such as Italy, Turkey or Egypt.