Plummeting euro rate is hurting Northern Ireland's hospitality trade
Northern Ireland's hospitality trade is facing a difficult road ahead as the strength of the euro continues to plummet.
The strong pound and weak euro is compounding the competitive disadvantage Northern Ireland's pubs, hotels and restaurants are facing over their neighbours in the Republic, the industry has warned.
With the pound currently sitting around €1.40, Northern Ireland is a more expensive destination for tourists from the Republic and the rest of Europe.
Exporters have also taken a hit as their products are less competitive in international markets.
Colin Neill, chief executive of Pubs of Ulster, said the strong sterling will mean it will be hard to attract tourists across the border.
"Outside of Belfast, 80% of all tourism comes from the Republic of Ireland. In Belfast it's about 65%," he said.
"There are big challenges, attracting the Republic of Ireland market is the bread and butter for the tourism industry."
Mr Neill said with the tourism industry in Northern Ireland paying 11% more in their VAT bill than their competitors in the Republic that "the exchange rate compounds the disadvantage we have".
Ulster Bank's chief economist Richard Ramsey said the speed in growing strength of the pound has been surprising.
"The euro is around 70p at the minute, I think it will be 69p within days. You would have to go back to 2007 to see numbers like that," he said.
The food and drink industry has benefited from an exchange rate that was closer to parity through the recession.
Mr Ramsey said: "They were the sector that bucked the trend during the downturn. During the years they had a weak sterling in their favour, it gave them a competitive advantage over their counterparts in the south.
"The exchange rate has allowed the food and drink sector to have record sales and gain market share over competitors in the south. Now the advantage is with the producers in the south."
The food and drink sector is not the only one to face tougher times with the weaker euro, with exporters losing competitiveness in their markets.
Stephen Kelly, chief executive of Manufacturing NI, said: "Exporters are finding it very hard. On one hand they are able to buy supplies from the eurozone at a lower rate, but more value in business comes from what they sell, not what they buy.
"It's putting a strain on those relationships. There are some contracts being lost.
"The impact of the exchange rate will be felt over the next couple of months, not just today."
Marcus Roulston, co-owner of Brown's Restaurant Group -which owns three restaurants in the north west and one in Letterkenny - said they have seen fewer customers from the south coming to Londonderry, but it hasn't affected business.
"Maybe we are lucky we haven't seen a decline," he said.
"We have noticed a decline in the amount of euros in the till in Londonderry but we are still fully booked."
He said Northern Ireland's higher VAT rate is a bigger problem over its competitiveness with its neighbours in the Republic.
The pound is at a seven-year high against euro, as the European Central Bank this week returned to a policy of quantitative easing, weakening the currency further.
While the eurozone is faltering, the UK economy has seen improvement.
That has led to sterling's value against the ailing euro strengthening at a rapid pace.