Cantillon: Duty-free could help drown Brexit sorrow

Among the Irish stocks hammered hardest since the vote on Brexit are, somewhat unsurprisingly, Ryanair and Irish Continental Group, the owner of Irish Ferries, both of which have shed a fifth of their market value since the vote.

Both are heavily dependent on the UK market as a source of customers, but also as a destination for customers sourced elsewhere. Any restrictions on travel to or from the UK will obviously hit each company hard.

There might be a silver lining to the cloud, however, in the prospect of the return of duty-free shopping for Europeans who travel to the UK.

Prior to the abolition of intra-European duty-free in 1999, the clinkety-clink of on board duty-free was the soundtrack to a nice little earner, for ICG in particular. In the late 1990s, half of its profits were associated with duty-free.

Eamonn Rothwell, the ferry company's chief executive, said in May it would be a "waste of time" for the company to plan for Brexit, which he said was "unlikely" to be the outcome of the vote anyway.

That prediction aside, Rothwell made the rational observation that even if Brexit came to pass, it would be two years before there was any visibility around the terms of its departure, including whether duty-free was back on the agenda.

Ryanair would appear to have less scope than the ferry operator to capitalise on the return of duty-free shopping to and from the UK.

But it could help alleviate some of the damage done to its results by the collapse in the value of sterling.

Similarly, the introduction of tax-free shopping for UK tourists visiting the Republic, such as the 23 per cent Vat refund currently available to non-Europeans, could help to plug some of the competitiveness gap that opened up overnight for the Irish tourism industry when sterling fell off a cliff. It could also help sustain retailers along the southern side of the border if Northern Ireland shoppers could slip across to the south and get 23 per cent refunded on big ticket purchases.

Taking a somewhat sunnier view, one benefit of the return of tax- and duty-free shopping would be that we could all go on cheap booze cruises to stock up, and drown our sorrows in mourning for the British exit.