Foreign media has been abuzz with reports of skyrocketing prices in Croatia this year, leaving many tourists questioning whether we are a destination still worth visiting. With competing options like Greece, Spain, and Malta offering more budget-friendly alternatives, Croatia’s reputation as an affordable getaway is facing challenges.
Why have prices gone up?
Inflation and the Euro Transition: The surge in prices can largely be attributed to overall inflation, which has hit Croatia particularly hard. The situation worsened as we transitioned from the old Kuna currency to the Euro on January 1st. This conversion led to an unwarranted rounding up of prices across the board. As retailers and importers hiked their prices (and profits), the increased pricing led to increased costs to other businesses.
Accommodation Price Hikes: Accommodation owners, who already enjoy lowest taxes in the country, seized the opportunity to boost their profits by further increasing prices. The government’s optimistic projections for a record number of tourist visits in 2023 only fueled this trend. Historically, prices tend to rise every year with the onset of the summer season, but this year saw even steeper increases as businesses sought to counteract their financial losses.
What’s being done to combat inflation?
Croatia’s government appears to be doing little to combat inflation, and in some instances, their actions exacerbate the problem. The widening income gap between loyal voters and the rest of the population is a glaring concern. The government continues to increase the wealth of their loyal voters, while throwing a few scraps to the rest who desperately need it more.
Additionally, a small cartel of retailers and importers have complete control over the market. It’s hard to say if because of corruption, incompetence, or both, but the government isn’t doing anything to enforce competitive practices or prevent them from making massive profits.
In a small market like Croatia, traditional market dynamics of supply and demand are disturbed by overly relying on tourism. And, with so few competitors in the market, everyone is equally happy to keep making record quarterly sales, with end consumers left to pay the bill.
How do Croatia’s prices compare to the rest of Europe?
Supermarket prices in Croatia either match or, in many cases, surpass those in other European countries, such as Germany or the United Kingdom. This disparity becomes even more pronounced during the summer, as coastal stores hike prices to capitalize on the tourist season.
This isn’t a new phenomenon here either. The only thing that changed is the shift to the Euro currency, which made these price discrepancies even more obvious to visitors who can now more easily compare prices to those in their home countries.
Standard of living is rapidly going down
Croatia’s median wage of €991 lags far behind the European average and barely crosses the halfway point of salaries in countries like Germany, France, or the UK. Due to higher prices and lower wages compared to most European nations, the cost of living for locals has become increasingly challenging. Tourists are also feeling the pinch as prices become less palatable.
Many of our retirees with their average pension of €414 a month are living in extreme poverty. Yet, the same ministers whose companies siphon money directly from the government and then conveniently forget to declare millions (note: article in Croatian) of income are the ones trying to convince us how lucky we are living here. The very bleak official statistics are often embellished in every possible way, and even then our politicians don’t hesitate to straight up lie. There are countless examples, truly.
In short, if you think the prices of food or hygiene supplies are high in Croatia, imagine how much harder it is with our income.
Are there going to be fewer tourists now?
Despite the escalating costs, Croatia’s strategic location makes it a convenient and attractive destination for many European tourists, especially those traveling by car. As such, it’s unlikely to see a significant drop in tourist numbers, providing little incentive to lower prices.
Should you visit Croatia next year?
Croatia tourism still mainly offers “sun and sea”, as we call it. Visitors seeking more diverse experiences may find their money better spent elsewhere. Destinations like Spain, Malta, Egypt, or Greece often offer superior value for your vacation budget.
For some tourists, €5 for a scoop of ice cream is obscenely expensive, but for some it’s just part of tourism. Croatia lacks a comprehensive, long-term tourism strategy, focusing instead on short-term profit gains.
See our Split travel costs article and use our handy calculator to estimate your vacation budget!
Are you telling me I shouldn’t visit Croatia?!?
It may seem counter-intuitive for a tourism website to advise against visiting a destination, but we always strive to provide honest, firsthand information. The reports of Croatia’s rising prices are, unfortunately, true.
Even the simplest accommodation now costs upward of €100, making it inaccessible for both locals and foreign visitors traveling on a budget. Events like Ultra Europe in Split, where accommodation prices quadruple, render living in the town unaffordable for residents.
It pains us to dissuade tourists from visiting Croatia, but it might be the only way to fight against incessant price hikes. You can only be a part of that fight if you choose another destination next year.
We can only hope, but perhaps decreased demand for accommodation and lower overall spending will be the only way to stop constant price hike. This may one day soon lead to Croatia once again becoming a destination that anyone can afford to visit.
The line between a costly vacation and feeling ripped off is getting thinner, just like our wallets. If you visit Croatia next year, you may have a wonderful time and enjoy it. But, we’re certain more and more tourists will come back home feeling they got robbed on every step. Just don’t say we didn’t warn you.
