As we get closer to the summer tourist season, questions arise like every year – what kind of season will it be, are we well prepared, where are the guests coming from, is Montenegro an expensive destination, do we have enough workforce…?
Dean of the Faculty of Business and Tourism from Budva, prof. In an interview with CdM, Dr. Rade Ratković says that the problems we are witnessing from 2020 will become substantially more acute, with the exception of the intensity of the pandemic.
He believes that tourism is collapsing, which is paradoxical, due to the decisions of those who are in charge of good destination tourism management.
“Among the bad decisions, we mention only the most significant ones: the deterioration of the traffic situation of the decision (the sudden grounding of Montenegro Airlines at the start of the 42nd Government, the rogue cancellation of a good ferry service in Boka and its replacement with a much worse one before the start of this year’s tourist season, failure to apply a good marketing strategy (marketing plan adopted in 2018 ., which also provided a new model of destination management), neglecting the organized European market from Europe’s strongest emitting sources, focusing on the worst (short-season and low-budget) tourist markets in Europe (Serbia, BiH – especially the entities of Srpska, Kosovo, Albania…), tolerating and speeding up the construction of residential buildings on the coast, including in the main mountain tourist centers of Montenegro, which further disrupts the otherwise extremely poor structure of accommodation facilities in Montenegro…”, says Professor Ratković.
The dizzying growth of real estate prices
Added to this, he says, is the reception of a large number of refugees from Ukraine and Russia, who have influenced the skyrocketing of real estate prices (buying and renting) and which have stimulated the owners of family accommodation to replace tourist rentals with long-term apartment rentals.
“Even some hoteliers are thinking of canceling their kitchens and restaurants, and of moving towards renting out apartments, which means that Montenegrin tourism is rushing towards total apartmentization (the well-known term “Budvanization”). We are becoming primarily a real estate destination, instead of a tourist destination. This means the loss of real tourism activities, which would be a huge blow to the economy and society of Montenegro”, believes Ratković.
The problem of labor shortage
When it comes to the labor force, the interlocutor of CdM states that it is our long-term problem, and in the last few years, the problem of Mediterranean tourism.
He notes that neighboring Croatia has a good strategy for solving that problem. They are implementing their good strategy for the development of sustainable tourism until 2030, which also includes the development of human resources.
“The main thing is to increase the earning power of tourism through: dominant penetration of the strongest emitting markets in Europe (Germany, Austria, the United Kingdom, France, Italy, Slovenia…), which generate a long season and good tourist consumption, the dispersion of the tourist product with the inclusion of the hinterland and all parts of Croatia, programmed increase in the motivation of the workforce (toward European wages, permanent seasonal status, additional material and non-material incentives…), orientation to the domestic workforce with the addition of the Region (and Montenegro), and the foreign workforce only as a temporary supplement, good destination management of an inclusive character, the commitment of the Government and the Ministry of Tourism and Sports to the development of sustainable tourism, digital management of tourism… We lack all of this,” Ratković points out.
He notes that our strategy is short-term and incomplete, that we do not have a human resources strategy in tourism, we do not implement a marketing strategy…
“In 2021, tourism was at a loss of around 50 million euros, and in 2022 (when the balances are collected at the end of July or beginning of August) a similar result is expected, which will continue this year as well. How to motivate workers and entrepreneurs in that situation!?”, Ratković is clear.
Relatively expensive destination
When asked by CdM whether Montenegro is becoming an overpriced tourist destination and whether our offer follows such a pricing policy, Ratković replied that, despite the poor structure of our tourist demand, we are a relatively expensive destination, especially in retail.
“There, we are significantly more expensive than many developed European countries (Germany, Switzerland…). The dominance of secondary housing generates consumption in retail, which is inflationary, and affects not only property owners, but also the local population, which loses spending power. Numerous studies of our overall pricing policy in tourism have revealed a disproportion between our prices and the value of the service”, notes the interlocutor of CdM.
We are behind in the offer
When we talk about the tourist offer, Ratković believes that, unfortunately, Montenegro lags far behind the other touristic countries of the Mediterranean, which are our natural framework for comparison.
“Ahead of us are all the touristic countries of the Mediterranean, from Croatia to Portugal, and then to the east, Greece and Turkey, and Albania is also becoming a significant competitor for us. Our weak points are: structure of tourist offer, structure of tourist demand, tourist and general infrastructure… Our greatest strengths are the three P’s: Nature, Space and Past. We pretty much neglected that “holy trinity” and only partially valorized it. Our biggest challenge is to valorize these assets of ours in a sustainable way. We need to build a national consensus on this, but it is not yet in sight”, concludes Ratković in an interview for CdM.