TOURISM and foreign investment will be the main economic casualties of any return to violence in the North Tourism has been identified as one of the keys to regenerating the economy in the North. Last year the total number of visitors to Northern Ireland increased by 56 per cent to more than 1.5 million, while the number of pure holiday visitors increased by 68 per cent, from 270,000 to 430,000.
The growth in visitor numbers brought an estimated 20 per cent increase in tourism revenue. After 25 years of the Troubles, spending on tourism infrastructure also expanded dramatically last year and several major hotels are under construction in Belfast and Derry. Tourism in the North was expected to create 20,000 jobs and generate hundreds of millions of pounds in revenue over the next 10 years.
But although the number of visitors has already increased dramatically, the impact of peace on tourism was expected to be more fully felt this year. Mass tourism depends on operators who usually plan itineraries and book hotels one year in advance. Therefore the 1996 season was the first in 25 years when the North could be marketed properly worldwide as a peaceful and safe tourist destination.
"We fear that this latest outrage will not do us any good whatsoever," said Northern Ireland Tourist Board spokesman Mr Joris Minne.
"Anything which disrupts the peace process is of the greatest concern to our industry."
The economic reverberations of the London bomb and the apparent end of the ceasefire are also likely to be felt in the Republic, particularly in Border areas.
THE Republic's tourism industry has also benefited greatly from the peace dividend as last year's record breaking figure of 4.2 million visitors was underpinned by peace. The Border counties were also set to have a record 1996 as these often neglected areas are an integral part of many newly organised coach packages to the North.
The British market has played a key role in the recent growth, particularly for weekend breaks and short holidays, while the number of American visitors has also increased dramatically. The US growth had started even before the ceasefires but was given an additional push by the advent of peace in the North.
Residents of both Britain and the US would be much less likely to travel to any part of Ireland should the violence resume.
The Government and Bord Failte may also decide to reconsider the recent decision to market Ireland on a 32 county basis in conjunction with the Northern Ireland Tourist Board.
The tourism industry is highly volatile, and attitudes to locations can swing dramatically in a short space in time. Even Paris - Europe's most popular destination - is not immune to bad publicity. After last year's strikes and terrorist bombs, hotels were forced to slash prices by up to 50 per cent.
The task of attracting inward in vestment to the North will also be made much more difficult by any return to violence. Since the ceasefires the North's Industrial Development Board (IDB) - its equivalent of IDA Ireland - has announced 20 projects, which included 13 new investments at an estimated value of £300 million sterling, which are together expected to create over 4,500 jobs.
The IDB's own figures show the dramatic impact that the ceasefire has had on potential foreign investors. In the six months before the ceasefires the agency dealt with 200 inquiries from potential investors. But between October 1994 and March 1995, the IDB had 700 inquiries, and since the ceasefires the number of visits to the North by potential investors has increased by 75 per cent.
The North's Economy Minister, Baroness Denton, has already admitted that an end to the ceasefire will make her job a lot more difficult, but added that she hoped potential investors would "stand back and examine and look" at the North's economic package for investors.
Many large companies such as Shorts, Fruit of the Loom and Dupont, have been building their businesses through the Troubles and show that you "can get on with business, even with the problems which we all pray will not happen again", Baroness Denton said.
IN the Republic, IDA Ireland is not expected to suffer hugely from any return to violence in the North as the agency has a long track record of winning blue chip foreign investors - even at the height of the Troubles. However, a resumption of violence may persuade some potential investors to switch their attention away from the Border counties, whose appeal had increased since the ceasefires due to their proximity to the North's transport infrastructure.
Retailing, particularly in Belfast and Derry, has enjoyed a huge boom since the ceasefires and the threat of any return to city centre bombings - or even bomb scares, which can have just as much impact on sales - would have an impact on that sector.
Major British retail groups, such as Sainsburys and Tesco, have already signalled their intention to enter the Northern market but it seems unlikely that they would back out at this stage as it would represent a massive public relations disaster for those concerned. However, companies which had planned to move into the North but had not made public their intentions may now quietly walk away.
