This week Sterling reached its lowest level against the €uro since the height of the financial crisis in 2009 and global financial services company Morgan Stanley has warned that Sterling and the €uro will reach parity by the end of this year.
According to research conducted on behalf of Tourism Ireland British people are less likely to travel in the wake of Brexit and when they do, they intend to spend less. UK visitors to Ireland dropped by 6.5% in the first half of 2017.
Furthermore, the continuing decline of Sterling will only further encourage cross-border shopping and damage Ireland’s competitiveness as a tourist destination. The latest figures available on cross-border shopping from InterTrade Ireland show this economic phenomenon is at its highest levels since 2009, again echoing the financial crisis.
These factors combined will seriously hamper the government’s ability to achieve its target of 50,000 new tourism jobs by 2025, believes DIGI.
”The growing belief is that as Brexit progresses without clarity, Sterling will continue to decline against a strengthening €uro,” stated Donall O’Keeffe, “The Government has targeted the creation of an additional 50,000 jobs in the Irish tourism sector in its ‘Realising Rural Potential’ action plan. However, if our largest tourism market is finding Ireland too expensive to visit, it will undermine this target.
“Ireland’s largest tourism market is the UK. British visitors account for 40% of all our overseas visitors. The UK is also our largest competitor from a tourism perspective and as their destination becomes more affordable, it creates a real challenge for the drinks and hospitality industry as international visitors may choose the UK over Ireland, especially when we have the second-highest levels of excise tax on alcohol in the EU.
“We are now in a situation where Brexit is impacting on the tourism sector and we need the Government to act rather than react. That’s why we’re calling for a Brexit Budget this October that will see the tourism and hospitality sector protected and supported.
“One of Ireland’s unique tourism offerings is the Irish pub and we are hampering our own tourism product with excessive taxation.”