The current situation in the tourism industry, the prospects for the development of tourism in Croatia, the Czech Republic, Greece, Montenegro and Slovenia in the next two to three years, and the necessary measures for the sector’s rapid recovery were the main topics of the regional virtual event “Tourism Perspectives in Light of the Coronavirus Outbreak”, held on April 16, 2020, and organized by the American Chambers of Commerce of Croatia, the Czech Republic, Montenegro, Slovenia and Greece.

AmCham Croatia Executive Director Andrea Doko Jelušić pointed out that the uncertainty of the development of the health situation in the coming months, the retention of jobs in the tourism sector, and the challenges the tourism companies will face in attracting guests impose a discussion on the new reality of the tourism industry following the corona shock. For this reason, AmCham Croatia organized a discussion that included global tourism trends, measures taken by the governments of these countries, and activities of the private sector taken in preparation for the reopening of the market, concluded Doko Jelušić.

The panel discussion was introduced by Siniša Topalović, a partner in Horwath HTL, who said that the COVID-19 pandemic has already had a negative impact on world capital markets, caused a decline in GDP of leading economies, and slowed the movement of goods and industrial production. Looking at the tourism sector, the existing physical measures of limiting social contact, which will continue to be applied until satisfactory control over the spread of the virus is achieved, will lead to large drops in demand (60% to 90%) and high dependence on the domestic market. It is roughly calculated that travel companies will experience a global loss of $11.5 billion; the hotel industry has suffered heavy losses, the hospitality industry has lost 100% of revenue in record time, and airlines have also suffered heavy losses. Regarding the recovery, it is estimated that it will take place in the direction of individual travel and individual business travel, while group travel will take more time to recover.

State Secretary from the Ministry of Tourism Tonči Glavina presented measures of the Croatian Government to help the economy, emphasizing that they are aimed at preserving the liquidity of economic entities and protecting jobs. As some of the horizontal measures, Glavina mentioned the possibility of interest-free deferral and installment payment of taxes, as well as an exemption from profit and income taxes, which would depend on the decline in income. As a measure to preserve jobs with employers whose economic activity has been disrupted, Glavina cited a government subsidy of HRK 4000 per employee. Given that tourism accounts for 20% of the GDP, special measures are being prepared for this sector.

Jan Herget, Managing Director, CzechTourism: In the Czech Republic, a “law on vouchers” has just been approved, by which package tours already paid are postponed and not canceled, thus helping the liquidity of companies in the tourism sector. Following the example of neighboring countries, such as Austria, the Czech Republic is considering lowering the VAT rate for hotels and restaurants from the existing 15% to 10%. Herget also mentions that the tourist community has changed its activities by focusing on domestic tourism, and trying to attract domestic tourists.

Damir Davidović, State Secretary from the Ministry of Sustainable Development and Tourism of Montenegro, spoke about the importance of focusing on the domestic market. In Montenegro, all package tours for April and May have been canceled. It will be difficult to make up for what we lost, and a downward pressure on prices can also be expected.

Marjan Beltram, Chief Travel and Mobility Officer at Nomago, points out that, after the emergence of coronavirus in Italy, the Slovenian tourism and transport sectors were reduced to a minimum in a very short time. Employers were forced to use furlough leave, which guarantees 80% of the salary to workers provided by the state, and which proved to be an excellent measure. The Slovenian government is also working on a set of sectoral measures that include vouchers for already planned package tours so that they are postponed rather than canceled, which helps the liquidity of companies in the tourism sector.

Andreas Stylianopoulos, CEO at Navigator (represents Royal Caribbean and Walt Disney) (Greece), concluded that the recovery process will not be easy, especially for cruise tourism as the future of all companies, especially cruise companies, is uncertain and their survival is questionable. Business models will inevitably change as the way people travel changes due to health concerns. The way we have worked so far is no longer applicable; we need to find a model that will be sustainable in the coming period.

Kai Dieckmann, CEO of Regent Porto Montenegro, states that we need to learn our lesson from the current situation, and prepare for similar future events. Quality should still be ahead of quantity, i.e. a drastic lowering of hotel accommodation prices to increase occupancy is not something that would compensate for the current losses suffered by the hotel industry in the long run. The introduction of high standards of hygiene in hotels, improvement of air conditioning systems, creation of innovative forms of accommodation, such as “luxury quarantine”, are just some of the concrete measures that have already begun to be implemented, and will become increasingly important in the hotel industry.

Today's event was attended by some 100 representatives of the business community and public authorities. Participants agreed that such a platform for exchanging experiences between countries is extremely useful, and that it should continue.