Weak sterling rate lures ROI shoppers to Newry

October 17, 2016

The economic fall-out from the Brexit vote is having a positive effect on retail economy in border towns with cross-border shopping centres such as the Quays and the Buttercrane in Newry experiencing a marked increase in shoppers from the Republic who are travelling north to take advantage of the strong euro.

The weak sterling rate has attracted thousands of southern shoppers to towns along the border in recent days with Newry traders seeing an upsurge in business as the value of the pound plunged last week.  Coupled with a post-brexit increase in cross border retail, the decline of the pound has seen a huge amount of bargain hunters head north and with the value of sterling sitting at around €1.11, it’s easy to see why.

Buttercrane manager Peter Murray said the shopping centre had experienced a significant spike in southern shoppers seeking out savings on a range of goods in the last week, coming after an increase in trade following the EU referendum.

“We had been seeing a leakage from Northern Ireland to the south, but that has stopped essentially, that tap has been turned off and the road to the north is open again,” said Mr Murray.

“Over July and August, we have had an increase of 63 per cent in the number of shoppers coming from the south and also anecdotally over the last few days we’ve seen an increase.”

Mr Murray said some businesses estimated increased profits of more than 20 per cent, a figure which could be set to increase if the exchange rate remains the same.

“If this attractive exchange rate continues, it won’t be just shoppers from nearby areas such as Monaghan, Louth and north Dublin that will travel north, we will get people from further afield, especially if they’re looking for a bargain,” he said.

“If it stays the same, we anticipate a good run-up to Christmas.”

Whilst the influx of cross border shoppers is good news for border towns and cities in the north, those in the Republic fear their retail sector will suffer badly if the trend continues.

Dundalk Chamber of Commerce PRO Paddy Malone said last week’s “missed opportunity” Budget  from the Irish government will drive more and more shoppers north in the build-up to Christmas.

Expressing his concerns, Mr Malone predicted the return of three-hour queues to Newry in the wake of the Brexit result and said he feared the worst after the Irish government failed to implement regeneration measures or rate relief to protect businesses along the border.

The chartered accountant said the continued decline of sterling could spell a return to the days of shoppers flocking north which will have a hugely detrimental effect on traders in Dundalk.

Highlighting that the retail sector in Dundalk is the area’s single biggest employer, he added,

“By shopping outside Dundalk you are not helping employment.”

There are also fears that the mass exodus of cross border shoppers could signal a hark back to the end of the last decade when southern shoppers caused traffic gridlock as they flocked across the border, causing 6km traffic tailbacks into Newry.   Coupled with the traditional increase in footfall in the run-up to Christmas, the unexpected boon for Newry retailers could prove less appealing for local shoppers who may see a return to fighting their way through throngs of euro bargain hunters, increased traffic congestion and parking misery as the city tries to cope with the influx.