Economy
Newry has a reputation as one of the best provincial shopping-towns in Northern Ireland, with the Buttercrane Centre and The Quays attracting large numbers of shoppers from as far away as Cork.
In 2006 Newry topped the league of house prices increases across the whole United Kingdom over the last decade, as prices in the city had increased by 371% since 1996. The city itself has become markedly more prosperous in recent years. Unemployment has reduced from over 26% in 1991 to scarcely 2% in 2008.
Since the inception of the global financial crisis of 2008-2009, shoppers from the Republic of Ireland have increasingly been crossing the border to Newry in order to buy cheaper goods. This owes to a combination of factors: the harsh budget in the Republic of Ireland in October 2008; the growing strength of the euro against the pound sterling and VAT reductions in the United Kingdom, compared with increases in the Republic of Ireland. This remarkable increase in cross-border trade has become so widespread that it has lent its name to a general phenomenon known as the Newry effect. In December 2008, The New York Times described Newry as "the hottest shopping spot within the European Union’s open borders, a place where consumers armed with euros enjoy a currency discount averaging 30 percent or more".
However the increased flow of trade has led to resultant tailbacks, sometimes several kilometers long, on approach roads from the south. This has created huge traffic and parking problems in Newry and the surrounding area. It has also become a political issue, with some politicians in the Republic of Ireland claiming that such cross-border shopping is "unpatriotic".
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