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2020/06/25 / Erste Group Research

CEE Special | Holidays under the cocovid tree

Countries dependent on international tourism inflow are most exposed to the negative impact of the pandemic. Health-related concerns and government incentives support domestic tourism.

Significant health security risks and impaired travel confidence will impact tourist preferences – from choosing a domestic location first (at least half of respondents prefer a domestic destination, according to surveys in Romania and Slovakia for example), to favoring options providing more privacy and less exposure to other guests. Furthermore, governments are likely to incentivize domestic spending by introducing holiday vouchers.

That poses a risk for countries such as Croatia, which relies heavily on international tourism that generates expenditure worth almost 20% of GDP. On the other hand, being a destination within reasonable driving-distance gives it an advantage over destinations which require air travel. Its accommodation structure, with 60% private apartments and 25% campsites, may also mitigate the negative impact of the pandemic.

Among CEE countries, Croatia is the most exposed to the inflow of international tourists. Although the direct contribution of tourism to GDP is around 10% (OECD), the international expenditure was worth almost 20% of GDP in 2019. It should come as no surprise that the share of expenditure of international tourists is also sizeable, as only 7% of overnight stays were domestic (as of 2018). Direct employment in tourism reaches around 6% in Croatia.

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General information

AuthorErste Group Research
Product nameCEE Economies Special Report
Topic in focusFX, Macro/ Fixed income
Economy in focusCEE, Croatia, Czech Republic, Hungary, Poland, Romania, Serbia, Slovakia, Slovenia
Currency in focusCroatian Kuna, Czech Koruna, Euro, Hungarian Forint, Polish Zloty, Romanian Leu, Serbian dinar
Sector in focus-


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