A new government means a new minister for Croatia's all-important tourism industry. In the first part of an extensive interview, TCN caught up with Minister Kliman on April 5, 2016, covering a wide range of tourism issues. The second part of the interview will be published shortly.
1. When you took over the office, Minister Lorencin spent two days with you handing over the ropes which was probably the longest time any former Minister spend with the incoming Minister. How much did that help you to get acquainted with the current state of affairs?
The Ministry of Tourism is a department which, when I took over, was in great shape, and results and revenues achieved in tourism prove we're on the right track. Former Minister Lorencin gave me a good overview of the current state in the Ministry, all achieved and planned programmes and projects, as well as a good introduction to the associates I will be working with which certainly made my first weeks a lot easier and gave me the opportunity to start with further improvements and strengthening of Croatian tourism as soon as possible
2. We have been hearing about the reconstruction of the Tourist Board for the last 5 years and yet nothing has happened. The system is still massive and yet they are not keeping up with the times or the demands of the rapidly changing tourism market. Will there be any changes in the near future?
One of my goals is to create a much more efficient tourist board system. I believe that, in cooperation with other members of the tourism sector and representatives from tourist boards, we will be able to find a solution that will enable a better and simpler operation that will bring benefits to all levels and to the entire sector. Tourist boards simply have to start creating a much better value that will enable Croatia to become even more competitive and recognisable.
3. We have cut down on the number of foreign Tourist Board offices and yet we have not increased advertising in the markets where our representatives are no longer present. Will this also be one of the tasks of the new administration? Re-evaluation of current positioning in certain markets?
Promotion of Croatia is the main task of the Croatian Tourist Board, I can definitely confirm that we will increase marketing activities in markets such as Russia, Scandinavia and the UK because these are all markets in which we believe we can make the biggest impact in a short period of time. What is most important for us is to act swiftly to changes and shifts in certain markets and to remain proactive in order to attract guests from new markets and strengthen our position on those markets f which we have a large number of guests.
4. The number of incoming tourists from the Republic of Korea is increasing daily and yet we do not have an Embassy in the Republic of Korea (even though there is a Korean Embassy in Zagreb), we are without an Ambassador in the Russian Republic for a while now and we are hoping to attract more Russians because of the current situation in Turkey and when it comes to China, a market everyone is trying to tackle and attract, we only have 3 people working in the Embassy that are supposed to cover a country with a population of 1.4 billion. How can we expect serious results with this kind of an approach?
I agree that we have to lay the foundation and introduce added activities on those, potentially very important markets. Guests from S. Korea, guests from Asia in general and all other non-European countries are very important to us, especially when we look at their numbers in pre and post season. They represent a very important factor in the transformation of Croatia into a year-round destination. Also, we are talking about markets where big changes are taking place, and that is why we must adapt to each market separately in order to ensure maximum efficiency of our promotional activities. Therefore, for the Russian market, along with additional promotional campaigns, we will also do everything in cooperation with the Minister of Foreign Affairs to simplify the arrival of Russian guests to Croatia.
5. New categorisation rules and regulations. Prof. Cvrtila has been trying to push the new categorisation regulation during the first few weeks of your mandate even though the former Minister placed it on hold because it was not ready for public viewing (contrary to the claims of prof. Cvrtila who said Lorencin just didn't have time to sign off on them and send them further). Even though regulations are much more sensible now in some respect, they still have some less logical components that require huge investments such as the stainless steel kitchen in traditional ethno homesteads and the requirement to hold international power plugs). Are the regulations now sent back for further evaluation?
Our goal is to create a more stimulative business environment in the tourism sector and I am sure that these changes in tourist regulations partly have the same aim. Public discussion is now over on this subject (note questions were sent before the public discussion even started), and the goal of the discussion was to see the needs and suggestions of the people in the industry. We believe we will come up with a solution in the end that will enable all tourism workers to achieve even better results and Croatia tourism to continue developing in the set direction with high quality as one of its priorities. We have constant meetings with the working group on this subject and we will not force anything. We will discuss every objection and ensure the best solution to increase the competitiveness of our tourism sector.
6. How satisfied are you with the way projects Kupari and Muzil were handled and what are your comments? Can those two projects be used as templates for other attractive locations, especially when it comes to former military bases? Especially Kupari because it was the first time three different concessions were issued for one project.
Investments are the strategic goal of this Government, and privatisation of some hotel companies and brownfield investments are of extreme significance. The practice we've seen so far represents a good foundation for further privatisation and placing some objects into a tourist function, but my goal is to include the Ministry even more in order to speed things up and to make things more efficient. I am especially pleased to see such good cooperation on all levels, this is a very important factor in creating a good investment which is a prerequisite for the further development of Croatian tourism. We now have a new director of DUUDI and I already have a good cooperation with him. We have held meetings of our operational groups for two strategic projects – Hotel Park in Rovinj and Airfield on Mali Lošinj and I expect those procedures to speed up. The contract for Kupari has been signed and we expect the much-awaited start of this large and very important investment for us.
7. Will this cabinet finally tackle the problem of tourist lands?
By dealing with the tourist land problem we will liberate a very large investment potential in campsites and hotels. This was confirmed by the representatives of camping and hotel associations, they all see this as an opportunity to raise their quality level and to expand their capacities. We will do everything in our power to see this potential come to fruition. This is a very complex subject but I believe we have prepared a very good suggestion which we will have to finalise with the industry and other ministries. I expect this bill to go into the procedure by the end of the year. We will for, a working group soon and start developing a completely new legislation.
8. Catalogue of Investment Opportunities – it all looks good in the PDF file until we scratch the surface and discover ownership or Master Plan problems, logistics nightmares and issues with local governments. Most of our potential investments end up failing because Ministries are not cooperating enough and we don’t have the free flow information which would prevent investors from running from one office to another. Some improvement was achieved in preparation for the Kupari project when 5 ministries worked together, do you intend to intensify this flow of information and cooperation between ministries when capital investments are in question?
Investments are definitely among my main goals as well as the improvement of our overall investment climate because these are the areas in which Croatia has the opportunity to raise tourism on a higher level which will, in turn, have a positive effect on our total GDP. State companies in tourism represent a great potential and our aim is to find the right strategic partners for them in oorder to entice investment cycles because investiments bring higher employment, GDP, higher standard for our citizens and better positioning of he Croatian tourism industry on the global market. In the upcoming period, we will place a large number of high-quality copanies that require investments on the market. We will evaluate every incoming offer very thoroughly and I believe that, with my associates and all expert panels, we will make decisions that will be of use toall participants of this process; from local governments, employees all the way to the State. The followinf hotels are currently in the privatisation process: Maestral in Dubrovnik, Imperial Rab as well as the minority share in Sunčani Hvar and all legal actions and tenders have been conducted for them. The value of just these three projects is approximately half a billion kuna. Ministry of tourism is acting as a coordinator in these processes, but, as a minister, I will ask for us to be more actively involved in the decision-making process in order to speed things up. Cooperation with other ministries is one of the key factors, and in all the discussions I've had so far with other ministers, we have agreed that only though cooperation can we achieve concrete goals and that is why it is important hat we continue with the same enthusiasm.
9. While we can expect investments of up to 650 million euro in tourism in Croatia this year, Montenegro will triple that amount with 5 capital investments and 5 star resorts from some of the biggest names in the industry. Why are they more attractive for investors?
Over 670 million Euros of investments are expected in 2016, more than half of it is investments by companies proving that Croatia is very interesting for investors, a part of these investments relates to public tourism infrasturcture which is also of significant importance for further development of destinations and the increase of our competitiveness. These investments do not include State owned companies that can surely almost double this amount. Furthermore, we have to take into account the potential value of military properties that still have to so planned investments are 35% higher than in 2015. According to the Tourist Development Strategy 2020 we plan to achieve 7 billion euros of investments, in other words, the largest number of investments is expected from 2016 until 2020 and I believe we can make this happen.
