The impact is already visible—tourists from key markets like Germany, Austria, the Czech Republic, and Italy are visiting less, leading to a 0.7% drop in foreign tourism revenue during last summer’s peak season. Meanwhile, destinations like Spain and Portugal continue to attract visitors by offering a balance of affordability and high-quality experiences.
As travelers seek destinations where their money goes further, Croatia’s tourism industry faces a real challenge: either adjust pricing strategies or risk losing more visitors to its European rivals.
Why Are Prices Rising So Fast?
You might assume skyrocketing prices are due to higher energy costs or increased VAT rates, but that’s not the case. In fact, Croatia has some of the lowest energy prices in the Eurozone and a reduced VAT rate of 13% for tourism.
So, what’s driving the surge? The answer lies in rising costs in the hospitality sector, which have led to higher accommodation and service prices. This rapid increase has resulted in a stagnation of overnight stays and a noticeable drop in tourist spending.
Key Markets Are Pulling Back
For years, Croatia has been a favorite among German, Austrian, Czech, and Italian tourists, but that trend is shifting. Higher prices are already pushing many travelers to reconsider their vacation plans.
Just last summer, Croatia’s foreign tourism revenue fell by 0.7% during the peak season compared to the previous year—a clear sign that travelers are looking elsewhere for better value.
Kristjan Staničić, director of the Croatian National Tourist Board, pointed out that for two-thirds of Croatia’s main tourism markets, cost is the most important factor in deciding where to travel. If prices continue rising, the country risks losing a major portion of its visitor base.
Government Urges Tourism Sector to Take Action
Croatia’s government is now stepping in, urging the industry to reconsider its pricing strategy before it’s too late.
Finance Minister Marko Primorac didn’t hold back, saying, “I feel like you’ve gotten a little carried away.” He questioned why Croatia should be more expensive than Greece, Spain, or Portugal, arguing that the country’s tourism industry relies heavily on taxpayer support, yet many locals can no longer afford vacations in their own country.
Tourism Minister Tonči Glavina also acknowledged the problem, calling 2025 a crucial year for making Croatia more price-competitive. While he dismissed concerns about a potential tourism boycott, he admitted that price cuts might be necessary to maintain visitor numbers.
Hospitality Industry Pushes Back
On the other side of the debate, industry leaders argue that rising wages and inflation—not excessive profit-seeking—are the real culprits behind higher prices.
Veljko Ostojić of the Croatian Tourism Association stated that hotel profits have actually declined, as costs are increasing faster than revenue. He also pointed out that Croatia’s hotel prices rose by only 1.9% last year, while other Mediterranean destinations saw a 4.5% increase.
Additionally, local business owners are voicing concerns over high commissions from global booking platforms, which cut into their earnings. Some have suggested launching a national booking system to reduce reliance on platforms like Booking.com and Airbnb, helping to keep costs in check.
Rising Prices + New Travel Restrictions = Trouble for Tourism
As Croatia grapples with rising costs, another challenge is on the horizon—new EU travel regulations.
Starting in 2026, visitors from non-EU, visa-exempt countries will need to apply for ETIAS travel authorization before entering the Schengen Area, including Croatia. While the process is simple, it adds another layer of complexity for tourists already debating whether Croatia is worth the higher price tag.
For budget-conscious travelers, this combination of higher costs and new entry requirements could be enough to push them toward more affordable destinations.
For long-term visitors, like digital nomads and seasonal workers, Croatia’s rising living expenses could also be a deal-breaker. Once seen as an affordable alternative to Western Europe, Croatia is quickly losing its cost advantage.
What’s Next for Croatia’s Tourism Industry?
The Croatian government is hoping for price stabilization in 2025, but the outlook remains uncertain. With key markets like Germany, Austria, and Italy facing economic slowdowns, tourists are becoming even more cost-sensitive.
If Croatia doesn’t adjust its pricing strategy, it risks losing its place as a top Mediterranean destination. Competitors like Spain, Greece, and Portugal are watching closely—learning from Croatia’s missteps while keeping their prices attractive.
One thing is clear: If Croatia wants to keep its tourism sector thriving, it must find a balance between maintaining quality and staying affordable. Otherwise, travelers will take their vacations—and their money—elsewhere.
Tags: Veljko Ostojić, Croatian Tourism Association, Kristjan Staničić, Croatian National Tourist Board, Greece, Spain, Italy, Austria, Germany, Portugal, Czech Republic
