Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in:  Talking Point: Forum
Front Page 
World 
UK 
UK Politics 
Business 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
Forum 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Friday, 4 January, 2002, 16:50 GMT
The euro at the border: How will it work?
To watch coverage of the forum, select the link below:

  56k  


The Republic of Ireland has enthusiastically embraced the euro, but what does this mean for its neighbours?

Businesses in areas along the border with Northern Ireland have been accepting euro currency this week, but how is the changeover affecting local business?

The Republic's finance minister Charlie McCreevy has described the switch as proof of the republic's economic health, but just how will the changeover affect residents on both sides of the border?

We were joined by a panel of local businessmen and women from both sides of the border to discuss the changes to the currency and the effects it has had.


The topics discussed in this forum were:

  • Dual currency
  • Impact on prices
  • European perspective
  • "Wait and see" policy
  • Impact on investment
  • Practical problems
  • "Euro creep"
  • Solution to Northern Ireland situation?



    Newshost:

    We're joined with people from local business on both sides of the border. Declan McChesney runs a shoe shop at Newry in Northern Ireland and is a member of the Newry Chamber of Commerce and Trade.

    Andrew Dearey runs the family department store at Dundalk in the Republic of Ireland and is also a member of Dundalk Chamber of Commerce.

    Dual currency


    Mike Maloney, Limerick, Ireland:

    Will Northern Ireland become a dual-currency area throughout or will the euro only reach as far as the border towns? Do people in NI feel "left out" or share the Euro-sceptic views of the "little Englanders" who wish nothing but ill on our new currency.


    Declan McChesney:

    We have viewed the introduction of the euro with a great sense of excitement and anticipation because Newry being the hinge town on the border and one of the chief shopping towns in the area, we have prepared from early 2001 for the introduction. All our computers, all our pricing were all set up to deal both in the euro and Sterling because we've been a dual currency area since the separation from the punt and the pound.

    We would say that whilst the border towns will deal equally with Sterling and the punt, as the "euro creep" progresses further into Northern Ireland, most of the towns in Northern Ireland will set themselves up and be prepared for it - certainly the multiples and all the large retailers will be ready and smaller retailers will by necessity become aware of it


    Newshost:

    But the implication from the question is that people just across, like yourself, could in fact be left out by not being part of the eurozone.


    Declan McChesney:

    I would disagree 100 per cent with that. I would say we see it more as an opportunity and a way of showing how our pricing structures and our quality levels can be priced on even terms with the rest of Europe and show the value that we can offer to the travelling public.


    Newshost:

    Andrew, how do you respond to this question? Do you see the introduction of the eurozone causing problems on one side of the border and not on your side?


    Andrew Dearey:

    As a border town, towns both north and south of the border, have been used to dealing with two currencies for a long, long time. It really doesn't present any difficulties to towns on either side of the border. Historically towns in Dundalk would have accepted Sterling and historically a town like Newry would have taken punts, so it's just a new currency for both of us and in no way a problem.

    Return to the top of the page


    Impact on prices


    Caroline Daly, Kildare, Ireland:

    Will traders in the north be forced to reduce prices to compete with traders in the Republic?


    Declan McChesney:

    Will we be forced to reduce prices? I know at the moment we're buying with a very strong pound which as most of materials and goods come from Europe, we have the facility to buy very well and therefore would sell very, very competitively. We don't see the euro as a necessity for price reductions or price increases. We see it as a method by the variation of the rates, albeit small, we will use those variations to increase the value and not increase the prices but offer better value to the customer coming to us.

    Return to the top of the page


    European Perspective


    Ernesto, Italy:

    I understand that it might be difficult to give up a currency full of history and pride but this is the same situation experienced by all the united European countries. Do British people realise that they cannot be equal partners of a super Europe and still go on using the old Pound?


    Newshost:

    There is a feeling, in some of the other countries in Europe that we are being left behind and yet you're saying you don't see this as a threat?


    Andrew Dearey:

    I don't see it as a threat at all because we have a rate, while pitched quite high at the moment, it may not be - certainly for manufacturing industries - advantageous for these businesses to go in at the euro rate that we are currently at - 62/63 pence. Whereas when Sterling comes back to a more realistic level of around, we believe, the 67 - 70p value - it would be better to be part of a similar currency but possibly not now with the strength of Sterling.

    Return to the top of the page


    "Wait and see" policy


    Barry, Derry:

    Won't the British Government eventually have to join the euro? Why are they staying outside it now? Is it a case of having your cake and eating it? - waiting to see how the currency does before making up their minds, pandering to anti-European nonsense? It is time to get off the fence and join the rest in euroland.


    Declan McChesney:

    I do. I feel they will be at a distinct disadvantage, particularly in relation their exporting. I know from sourcing products across EU countries - we're looking for price stability. We want to know that what we buy today is going to come into us in nine months time at that price. We don't have those guarantees with pound Sterling. We don't know what it's going to be worth in nine months time. Certainly that would influence us in our buying - we would spend our money where we know prices are fixed.

    Return to the top of the page


    Impact on investment


    Newshost:

    Let's bring in our two guests. We are joined by Breige Savage who is the general manager here at the Carrickdale Hotel, who are our hosts today and also by Conor Patterson, who is chief executive of the Newry and Mourne Enterprise Council just across the border in Northern Ireland.

    Conor, let me start with you first of all. Given the job that you do, are you concerned that the euro is now here south of the border but in Northern Ireland you still have the pound Sterling. Is that going to have an impact on investment for example?


    Conor Patterson:

    On a practical level, as Declan has said, we are a very adaptable people. We have adapted to a dual currency for many years now. We are concerned that in the competition, for example, for inward investment, inward investors targeting Ireland as an investment location are possibly more likely to be attracted to the Irish Republic that's within the eurozone.


    Newshost:

    We have a question on this issue from William Wilson in the United States who asks: Will it potentially be more advantageous to invest in Eire instead of the United Kingdom?


    Conor Patterson:

    Potentially it is, being realistic about it. We would be quite open in saying that we would prefer that Northern Ireland was part of the eurozone along with the rest of the United Kingdom. That would be to the advantage of people in Newry and Mourne.

    Return to the top of the page


    Practical problems


    Newshost:

    Let's bring Breige Savage in at this point. Running a large hotel on the border, what kind of practical everyday problems are you going to face now because at the moment at least you have three currencies to deal with?


    Breige Savage:

    Up until now we've had two currencies and another one is not really going to make any difference. What I am saying to my staff is - and we all agree on this - that the sooner the Irish pound disappears the better and it's only going to last for a very short time. So the other currency is not really putting us out in any shape or form. It's just a little bit difficult at the moment. The sooner the Irish pound goes - it's just another currency then. I would say probably in a week there's not going to be very many Irish pounds around.


    Newshost:

    I see on the table in front of you have your calculator which I think virtually everyone in the Irish Republic has been given one of these to help this transition between the punt and the euro. Presumably you are finding that very helpful?


    Breige Savage:

    Yes it's good because it's small, you can put in your pocket. On the left hand side we've got the Irish pound logo and the euro logo and vice-versa on the other side we've got the euro to the Irish pound.


    Newshost:

    We have an e-mail - a practical point - from Mary in the United States who asks: I'll be visiting the Republic of Ireland in a month and spending four nights in Northern Ireland. What should I be prepared for? Getting the euro for Dublin and changing to the pound for the rest of the stay in Belfast and Londonderry? You can see how people are going to be confused?


    Beige Savage:

    I would say to the questioner if they are travelling from the United States and they are coming to the South of Ireland, they should transferring their money into euros. Then when they go north, the same thing again - back into Sterling.


    Newshost:

    You are running a hotel which is just south of the border in the Republic. I know that you actually live in the North and I believe some of your staff do as well. So how do you deal now with things like salaries?


    Beige Savage:

    This weekend was the first weekend that all of our staff, including the managerial team as well, we were all paid in euros. So what's going to happen now is that it's going to be euros - this is a euro country we are in. Our Northern Ireland staff are going to be paid in euros because this is now a euro country.

    Return to the top of the page


    "Euro creep"


    Newshost:

    People are already talking about "euro creep". How soon do you think it will be before we see a significant number of businesses in the North of Ireland trading in the euro as well as the pound?


    Conor Patterson:

    I think businesses in Northern Ireland have been preparing for some time, as with businesses in the Irish Republic. What will be interesting to observe is the impact in mainland Britain. I think after the summer holiday period, when millions of people who have been overseas in Europe on holiday have money to bring back in the UK economy - that's going to be an interesting day - to see the impact on British public opinion then.

    Return to the top of the page


    Solution to Northern Ireland situation


    Newshost:

    Let's turn back again to Declan and Andrew. We have an e-mail from Charles Forester in Australia who asks: The euro has made it possible that there may now be a solution to the Northern Ireland situation. If the UK was to enter into the common currency there would be a demolishing of what's been cultural barriers by making the border seem even less apparent than it ever was. People will be made to feel more comfortable with the fact that life will be pretty much the same on either side of the border.

    Are we looking at happier times for Ireland, both north and south?


    Andrew Dearey:

    I think the introduction of the euro would be a significant contributory factor to the mobility of people. I think you will probably find that people from southern Ireland would be a lot more willing to travel north because the actual dynamic of it has been made easier for them. I think it will be a significant contributory factor to cross-border trade and mobility of people.


    Newshost:

    Declan, how do you respond to the questioner from Australia?


    Declan McChesney:

    We're living in historic times in Northern Ireland and brick by brick we're building a wall against the darkness of the past. Each element that brings us forward blocks out that darkness. Certainly if we're encouraged to look at north and south as one - as we do in tourism, as we do in many other fields - it will assist us. If we look on it in a pan-European element as well, once we have a wider view we have a much greater chance of putting that terrible period behind us.

    Return to the top of the page


  • See also:

    Internet links:


    The BBC is not responsible for the content of external internet sites

    Links to more Forum stories are at the foot of the page.


    E-mail this story to a friend

    Links to more Forum stories