Aer Rianta yesterday sought the support of the Irish suppliers of duty-free goods in its campaign to halt the phasing out of duty-free by 1999.
The business at risk is worth £71.5 million at 1995 prices, Aer Rianta's group commercial manager, Mr Frank O'Connell, told a group in Dublin representing the drinks, tobacco and other industries that sell in duty-free shops.
Under an EU directive due to come into force in June 1999, duty-free sales to travellers within the 15 member-states will end, though duty-free sales to the US and other non-EU destination can continue.
Mr O'Connell said Aer Rianta will have to cut what it buys from Irish suppliers by some £50 million worth. The effect will be catastrophic, Mr O'Connell said, including the effect on the 11,000 Irish people directly employed in the duty-free industry.
Duty-free accounts for 60 per cent of Dublin Airport's profits, according to Mr O'Connell. A loss on this scale would require the revenue to be replaced by higher airport charges.
This, in turn, would be passed on by airlines to their customers and would undermine the tourist industry, since much of its recent success has been attributed to low access fares.
Mr O'Connell painted an even bleaker picture for Cork Airport, where intra-EU sales account for 95 per cent of all duty-free sales and Aer Rianta would have to seriously consider the viability of having a duty-free shop at all at Cork.
The situation is not quite so bad at Shannon, because duty-free sales to US passengers would not be affected.
Mr O'`Connell is chairman of the International Duty Free Confederation, a lobby group set up to persuade the EU Commission to recommend that the duty-free directive be reversed. He said no EU directive has ever been reversed and acknowledged it would be an uphill battle, "but it's not impossible".
The Taoiseach, Mr Ahern, is personally committed to arguing for the retention of duty-free, according to Mr O'Connell. The confederation has appointed Mr John Hume jnr as its public relations adviser in Brussels.
Mr O'Connell said a special study of the effect on the Irish mushroom industry has been commissioned as the abolition of duty-free will have consequences for freight charges on the Irish Sea car ferries.
A report on the effect on airlines, published on Thursday, said 50 per cent of surveyed airports would be loss-making if the revenue from intra-EU duty- and tax-free sales disappeared.