Price increases in Croatia: Is your dream vacation in danger?

Price increases in Croatia: Is your dream vacation in danger?

Croatia expects record tourism results in 2025, but there are significant concerns about price competitiveness. Kristjan Staničić, director of the Croatian Tourism Association, warns that Croatia is at the limit of its price competitiveness. He calls for an appropriate pricing policy in order to maintain the country's attractiveness for holidaymakers. Prime Minister Andrej Plenković has emphasized the need to strengthen this competitiveness, as around 50% of holidaymakers make short-term travel decisions based on price considerations, such as Small newspaper reported.

While Plenković is optimistic that the record results of previous years will be achieved or exceeded this year, there are threatening developments in the price structures. Hotels and campsites in Croatia are more expensive than in Greece, Spain and Italy, but cheaper than in Austria and Germany. Private accommodation is, in turn, more expensive than in Italy and France and only slightly cheaper than in Greece and Spain.

Rising prices endanger tourism

In recent years prices in Croatia have increased significantly. From the pandemic until the end of 2024, prices were 50% higher than those of other Mediterranean destinations. This is particularly worrying as Croatia was already 10 percent more expensive than Spain and Greece in 2024, after being 10 percent cheaper two years ago. This dynamic price adjustment could harm long-term economic growth, government officials warn Glass Hrvatske determines.

Another factor is the declining willingness of foreign tourists to spend. In the high season, per capita spending fell by 0.7 percent compared to 2023. Rising prices in the service sector, especially in the catering and hotel industries, contribute to inflation, which in Croatia is above the Eurozone average. Prime Minister Plenković recently chaired the second meeting of the Tourism Development Council in Zagreb, where Governor Boris Vujčić was also present. Vujčić pointed out that rising service prices act as the main driver of inflation.

Need for action recognized

The situation has also brought action members from the industry into action. Jelena Tabak, president of the Hospitality Traders Association, expressed hope for more careful pricing in the coming season, as declines in occupancy were observed last season. Dalibor Kratohvil, President of the Croatian Chamber of Crafts, appealed to the need for measures to reduce costs and relieve administrative burdens. A proposal to reduce VAT on drinks has been considered to prevent further price increases that could jeopardize Croatia's attractiveness as a holiday destination.