Tourism Policies in Post-WWII Yugoslavia

The central planning of economic activity was characteristic of the socialist states that emerged in Eastern Europe after the Second World War. The nationalization of enterprises and state ownership of the means of industrial production and agriculture were accompanied by a series of 5-year plans with which the socialist governments in Eastern Europe directed the economic development of their countries. Yugoslavia, which is neither a free market economy nor a member of the Soviet-controlled Eastern bloc, has developed its own economic model. Although the state followed the socialist model of nationalization of industry and central planning, the Yugoslav economic system was less rigid than in other Eastern European countries. Although the country maintained economic relations with the countries of the Eastern Bloc, the Yugoslav economy was heavily dependent on Western markets. In the 5-year plans introduced in 1947, tourism was always addressed in some way. However, the importance given to tourism has changed over time. In the first 5-year plan, tourism was viewed primarily from the perspective of the Yugoslav working class—as a tool for the regeneration and recreation of workers, who were considered the cornerstone of society. This view changed when tourism was recognized as a potential foreign exchange earner. In the 1960s and early 1970s, 5-year plans allocated large funds for investment in new tourism infrastructure, mainly built on the Adriatic coast. These investments were targeting the growing tourist demand from Western European markets. Within a few years, the share of foreign visitors in the Yugoslavian tourism market doubled. Tourism soon became a key contributor to country’s balance of payments. In the 1980s, the consolidation of the country’s stagnating economy required large sums of foreign currency. This put pressure on tourism, which continued to rely on mass tourism without making new investments or maintaining the existing infrastructure. With the emergence of new competition on the global tourism markets (e.g. Southeast Asia and southern Mediterranean countries), Yugoslavia’s tourism offer began to lose its attractiveness. In the last years of the decade, tourism demand began to decline and collapsed completely in 1991 with the break-up of Yugoslavia.