| 2.9°C Dublin

Tourism slump costs economy €600m

A collapse in numbers of tourists coming to Ireland - particularly British visitors - has cost the economy more than half a billion euro, it was revealed today.

In its toughest year for more than a decade, the industry was hammered by the economic crisis, severe weather, its own high prices and the volcanic ash cloud.

Failte Ireland revealed one million fewer people holidayed in Ireland during 2010, which is estimated to have cost businesses €600m compared with the year before.

The fall-off was sharpest among British visitors - Ireland's biggest tourism customers - with numbers travelling across the Irish Sea down by almost a fifth.

Shaun Quinn, chief executive officer of Failte Ireland, said it would be targeting the UK market in the year ahead.

"It is in Britain, representing 45pc of our overseas visitors, where we will need to turn the tide but where we face the greatest challenge," he said.

Mr Quinn signalled the more prosperous London and South East of England would be key to attracting more holidaymakers.

"There are some favourable factors now coming into play for us," he said.

"Our own falling prices, the recent cut in the air tax, the rise in VAT in the UK and the growing strength of sterling to the euro all combine to make Ireland an even more attractive and accessible option for potential British visitors."

Arrivals in Ireland last year from continental Europe also fell significantly, by almost 17pc.

There was a 9pc drop in North American tourists and 2pc fewer visitors from other overseas destinations.

Failte Ireland said the number of Irish people holidaying at home - known as staycations - had remained steady but they were spending less during their breaks.

Two-thirds of hotels and other tourism providers claimed they lowered prices last year and a third were expecting to cut them further in the year ahead.

PA Media