Northern Ireland faces challenge in attracting Southern visitors

If you live in the Republic and are thinking about taking a little break it’s unlikely you are planning on heading North.

The same is true if you live in Northern Ireland and are considering a night away – chances are you might not be thinking of a "staycation" for your getaway.

Because despite all the obvious attractions that Northern Ireland has to offer – from the Titanic Belfast to our very own Unesco World Heritage Site, the Giant's Causeway – it would appear this may be not be enough to tempt some people to stay.

The latest tourism figures show a worrying drop in the numbers on the island choosing the North as a destination stay. Even people who live in Northern Ireland are holidaying-at-home less but this is probably more to do with a general tightening of household purse strings.

According to provisional tourist statistics there were 64,000 less overnight trips taken by Northern Ireland residents in the 12 months to March of this year.

It is a worse picture when you look at the number of overnight visits by residents from the Republic in the same period. The latest figures compiled by the Northern Ireland Statistics & Research Agency show there were 79,000 less overnight visits between April 2013 and March 2014.

Fall in spending

It estimates these figures add up to a correlating fall in spending by Northern Ireland residents of £15 million and a potential drop in Southern visitor spend of £7 million.

Bear in mind that during 2013 the North hosted a very peaceful G8 Summit, the World Police and Fire Games, the Fleadh Cheoil na hÉireann and Derry was also the UK city of Culture.

So some might suggest that the latest figures might not add up to a very glowing end-of- year report for the Northern Ireland Tourist Board (NITB).

But to be fair to the NITB it really does not have the easiest job in the world: can you think of another statutory tourist agency that has to factor in the prospect of potential unrest, possible flag disputes and what ever else might possibly occur when running advertising campaigns.

Dr Howard Hastings, who has been chairman of the NITB since 2009, says the "image issue" may be one of the reasons for the drop-off in overnight visitors from the Republic but there are also other factors at play and one of those is definitely cost.

“When you consider currency growth and the year-on-year appreciation of sterling against the euro then Northern Ireland got more expensive for visitors from the Republic.

“The best period we ever had was five winters ago when the VAT rate in Northern Ireland was 15 per cent and the equivalent rate in the South was 13 per cent and the euro was around 1.05 against sterling. Since 2011 the VAT rate in Northern Ireland has been 20 per cent compared to a rate of 9 per cent for the hospitality sector in the South. It’s a very price sensitive market and people are very aware of exchange rates,” he says.

The VAT problem is a big hurdle for the hospitality industry in the North according to Janice Gault, chief executive of the Northern Ireland Hotels Federation (NIHF).

VAT reduction

“A reduction in VAT in Northern Ireland would help make us more competitive along with a stronger events calendar to attract Southern guests,” she says. “The NIHF position would be that the ROI market is an important sector for the industry. In reality it remains the third largest sector after the NI domestic and the GB markets.”

According to Dr Hastings, the upside is that when visitors from the Republic do come North they are generally struck by how good value it is compared to the cost of a stay in some parts of the South.

“It is more cost-competitive when it comes to eating out and entrance prices to visitor attractions, some of which are free, and even getting around in public transport or private transport – we work really hard to make sure people have a good experience,” Dr Hastings adds.

He does worry, however, that Northern Ireland has an increasingly bigger battle on its hands to attract overnight visitors from the Republic of Ireland as a result of the improving air access from Dublin and other Irish airports to UK and other European destinations.

This is why Dr Hastings says it is vital that NITB keeps promoting what is on offer in the North to potential visitors from the South – despite suffering major cuts to its advertising budgets.

“We know from our research there are 2.5 million people in the Republic of Ireland who have never overnighted in Northern Ireland. Now there are half a million out right who will never come mainly because of short-term issues that underline longer-term perceptions of Northern Ireland but the other 2 million people are our target market – they are the big prize and we want them to come and visit Northern Ireland for the first time and then keep returning as regulars.”