Euro adoption to have positive impact, particularly on tourism, says ministry

NEWS 11.11.2020 19:11
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Source: PHILIPPE HUGUEN / AFP

Introducing the euro in Croatia will generate a significant and permanent benefit for the economy and the positive effects will be particularly reflected in tourism due to the size of that sector and its high share of tourist demand in EU member states, the Ministry of Tourism and Sports said on Wednesday.

“Visitors from countries where the euro is legal tender generate almost 70% of Croatia’s total tourism revenue and about 60% of total bed nights come from the euro area. Introducing the euro will also help boost international cooperation, investment and promotional effects on the tourism sector,” the ministry said in response to a query from Hina following a meeting of the National Council for Euro Adoption.

The ministry underscored that Croatia is strongly integrated with the euro area through trade, hence introducing the euro in Croatia will generate significant benefit for the economy.

“It is important to observe and estimate how introducing the euro will affect individual sectors in Croatia, primarily tourism which accounts for a significant share of Croatia’s GDP and additionally generates a multiplying effect on other economic activities,” the ministry said.

It underlined that “available empiric research mostly indicates positive implications for tourism in introducing the common currency.”

Research indicates that introducing the euro has positively impacted foreign investments, hence it can be expected that introducing the euro will encourage investors in Croatia, primarily as there will no longer be any uncertainty related to exchange rates and because of greater transparency in doing business, the ministry concluded.