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24/04/2009
Cost Of Cross Border Shopping Again Underlined
While this week's UK Budget increase in the cost of alcohol will allow limited relief for the retail trade in the border counties of Ireland, the huge level of trade already being lost north has been confirmed.
Northern Ireland's economy was boosted by around €500m (£450m) last year just from Southern shoppers in grocery outlets.
New figures released by Tesco come with the admission that the Irish Republic's grocery trade has taken a 4% hit thanks to cheaper prices north of the border.
The effect on the Irish economy of shoppers heading across the border to places such as Londonderry, Strabane, Enniskillen and Newry was recognised in the South's Emergency Budget earlier this month.
Duties on petrol and alcohol were left unchanged in an attempt to curb the vast number of consumers who are taking their trade across the border.
But now that Chancellor Alistair Darling's 2009 Budget has promised a 2% hike on items such as alcohol and tobacco products there has been speculation that Northern Ireland may become less alluring for some shoppers.
However, with the cost of fuel still cheaper in Ireland, where diesel is, on average, 18p a litre less, only time will tell if the new levies will significantly curb the cross-border flow of traffic.
The startling statistics follow a recent announcement by Tesco of a 5.2% increase in world profits to €3.15bn for the year to the end of February.
Tesco said that lower prices, the UK's lighter VAT rate and the weak value of sterling were responsible for the loss of 4% of the Republic's €12bn retail and grocery trade into the north.
It added that cross-border shoppers spent €450m to €520m (£405m-£468m) in Northern Ireland last year, the vast bulk of which was spent on groceries, an estimate based on a recent Irish Revenue Commissioners and Central Statistics Office report.
Tesco has turnover of €3bn in Ireland and just over a quarter share of the market, so a 4% drop in business would cost them approximately €120m.
They have seen increases in sales of clothing, bakery, fish and meat, whereas alcohol and household sales have dropped.
See: Boost For Border Traders As Budget Targets Booze
(BMcC/JM)
Northern Ireland's economy was boosted by around €500m (£450m) last year just from Southern shoppers in grocery outlets.
New figures released by Tesco come with the admission that the Irish Republic's grocery trade has taken a 4% hit thanks to cheaper prices north of the border.
The effect on the Irish economy of shoppers heading across the border to places such as Londonderry, Strabane, Enniskillen and Newry was recognised in the South's Emergency Budget earlier this month.
Duties on petrol and alcohol were left unchanged in an attempt to curb the vast number of consumers who are taking their trade across the border.
But now that Chancellor Alistair Darling's 2009 Budget has promised a 2% hike on items such as alcohol and tobacco products there has been speculation that Northern Ireland may become less alluring for some shoppers.
However, with the cost of fuel still cheaper in Ireland, where diesel is, on average, 18p a litre less, only time will tell if the new levies will significantly curb the cross-border flow of traffic.
The startling statistics follow a recent announcement by Tesco of a 5.2% increase in world profits to €3.15bn for the year to the end of February.
Tesco said that lower prices, the UK's lighter VAT rate and the weak value of sterling were responsible for the loss of 4% of the Republic's €12bn retail and grocery trade into the north.
It added that cross-border shoppers spent €450m to €520m (£405m-£468m) in Northern Ireland last year, the vast bulk of which was spent on groceries, an estimate based on a recent Irish Revenue Commissioners and Central Statistics Office report.
Tesco has turnover of €3bn in Ireland and just over a quarter share of the market, so a 4% drop in business would cost them approximately €120m.
They have seen increases in sales of clothing, bakery, fish and meat, whereas alcohol and household sales have dropped.
See: Boost For Border Traders As Budget Targets Booze
(BMcC/JM)
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