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Ethnic Discord : Yugoslavia's Once-Popular Resorts Are Virtual Ghost Towns : Tourism is a victim of the violent outbreak between rival nationalities. In Dubrovnik this spring there is little laughter.


DUBROVNIK, Yugoslavia — As a brilliant sun sinks into aquamarine waters behind the bleached walls of this ancient fortress, Croatian entrepreneurs like Bozo Medi feel the emptiness in their wallets like a knife in the heart.

"It's not the weather keeping people away. It's our internal troubles," the leather-faced boatman observed stoically, squinting as he maneuvered his handmade cutter westward into the sun.

The picture-perfect days of late spring underscore the tragedy of Yugoslavia's latest crisis. Violent outbreaks between rival nationalists have frightened away tourists, turning coastal resorts into ghost towns and depriving tens of thousands of a whole year's earnings.

Eager owners of new private restaurants lurk anxiously around vacant outdoor terraces, their tables draped with crisp linen in vain hopes of a paying guest.

The limestone walkways of the old town, worn to a waxy glimmer by centuries of strollers, are almost abandoned as city residents retreat from the ritual sunset promenade. Footsteps of the few night owls echo eerily off shuttered shops.

Usually, Dubrovnik is alive day and night with people, music and chatter even before the beginning of the high tourism season in early June. But this year Yugoslavia's best-loved resort is painfully silent. So far this month there have been only a third as many tourist arrivals as a year ago, the city's board of tourism said.

Disturbed by scenes of rioting in the coastal city of Split and ethnic clashes that have killed more than 20, both foreign and domestic tourists are spurning Adriatic vacations. Bookings by foreign agencies have dropped by 80%, and many Yugoslavs are forgoing coastal visits for lack of money or fear of mistreatment.

As tensions between Serbs and Croats sharpen in the buildup to what many fear will be civil war, some Serbs, particularly, say they will avoid the Croatian coastline this year. Meanwhile, the U.S., British and Australian governments have warned travelers to avoid the strife-torn country, clobbering a key Yugoslav industry still reeling from the tourism falloff inflicted by the Persian Gulf War.

Tourism throughout Yugoslavia was down by 73% the first five months of this year, according to the Tanjug news agency. The source of about 10% of Yugoslavia's hard-currency earnings, tourists are crucial to the country's ability to make payments on its $16 billion foreign debt as well as for financing of imports.

This season should have been one of the best ever for those doing business along the Adriatic Sea, which Yugoslavs like to call their Riviera. The overvalued dinar that hurt them last year has since been devalued to restore bargain prices. Constraints on private enterprise have been lifted, encouraging a fresh crop of new restaurants and hotels and keener competition to provide good service.

Some Croats claim that the ethnic disturbances are part of a Serbian plot to destroy their republic, which has taken steps to secede from Yugoslavia, perhaps as soon as the end of this month.

"The Serbian government leaders said they would impoverish Croatia and Slovenia if we tried to secede, and that is just what they are doing," insisted Medi, whose summer income from running a water taxi used to sustain his family through the rest of the year.

While nationalists might revel in the economic damage being done to Croatia before any war has even begun, the interlocking nature of the Yugoslav economy will spread the pain around. While the longest, most attractive and best developed stretch of coastline belongs to Croatia, businesses in Serbia supply much of the food, transport and labor for the chain of resorts.

"We aren't the only ones who will suffer," said Ante Gluncic, who takes travelers to the coastal islands in his 18-berth cabin cruiser. "We buy paint for our boats from Serbia. Food suppliers are also from Serbia. If we lose, they lose, too.

"They have to understand that when it's good for us, it's good for them," he explained. "We've had a Serbian chef for the past three years, but I had to tell him not to come this year because we have no guests to take care of."

Gluncic had been expecting a banner year, as a French partner booked his boat through the season and had already filled each two-week cruise by early spring. But after pictures of rioting and unrest in Croatia spread through Europe in May, the French agency canceled tours for June and put Gluncic on notice that any further business this summer would depend on Yugoslavia resolving its crisis.

The 34-year-old captain says his business is devastated and that his family will suffer the consequences all winter.

"This is exactly what the extremists want--to destroy Croatian tourism," says Davor Faget, manager of the Ministry of Tourism office in the republic's capital of Zagreb. "We depend on the tourist industry. If they destroy this, they can make a shambles of Croatia."

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