Tourist industry selling England by the pound

Wed Jan 14, 2009 7:47pm EST
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By Avril Ormsby

LONDON (Reuters) - With the pound at new lows against the euro and the dollar at the end of 2008, Britain looked good value to Maltese couple Mario and Josanne Cassar. They bought two suitcases to get all their purchases home.

"It's almost ridiculous, the prices we are paying," Mario said as he and his wife visited St Paul's Cathedral in London.

They are not the only tourists drawn to Britain by more than the sights of Big Ben, Stonehenge or Shakespeare's birthplace. On top of the weak pound, steep discounts offered by cash-strapped retailers are bringing people to shop.

"Accommodation is cheap, food is cheap and we have bought lots of clothes," 50-year-old Mario said.

With Britain's economy in reverse and interest rates at their lowest in history, 2008 was the weakest year for the pound since 1971. Sterling fell 27 percent against the dollar and the euro gained 30 percent against it to bring the two within striking distance of parity for the first time.

Britain's currency on Tuesday also hit a near 14-year low against the yen.

In the past month the Eurostar cross-channel rail service has recorded a 15 percent rise in passengers from Brussels and Paris.

But if Britain is becoming a magnet for bargain hunters, Britons abroad face dwindling spending power and some are contemplating cheaper domestic holiday destinations.   Continued...

<p>Tourists on a sightseeing bus pass the Houses of Parliament, in London January 9, 2009. The pound plummeted to new lows against the euro and the dollar at the tail end of last year making Britain look good value for continental Europeans and Americans. REUTERS/Stephen Hird</p>