Royal 'baby boost' expected for British business

LONDON - British companies can expect a temporary boost from the birth of Prince William and Kate's new baby as souvenirs and champagne fly off the shelves and tourists flock to the country, business leaders and analysts said Tuesday.

Retail sales could see an increase of £243 million ($372 million, 283 million euros) from the arrival of a future king, based partly on the experience of the couple's wedding in 2011 and the diamond jubilee of Queen Elizabeth II in 2012, analysts said.

"If the experience of the royal wedding and the jubilee is anything to go by, this good news should also bring about a temporary 'baby boost' for retailers in the UK," said Helen Dickinson, director general of the British Retail Consortium.

"It will undoubtedly bump up sales of baby products, souvenirs and brands favoured by the new royal parents, but the past two years have also demonstrated that the feelgood factor has a more wide-ranging positive impact on retailers."

The birth will also give a "temporary lift in the general mood" at a time of broader economic gloom and austerity under Prime Minister David Cameron's Conservative-led government, she said.

International consumers may also be more likely to visit British brands' websites and overseas stores, said Dickinson.

Howard Archer, an analyst with IHS Global Insight, said that while there was huge global interest in the birth of the new third in line to the British throne, the economic impact would be "limited -- albeit overwhelmingly positive".

"At the margin, the royal birth may provide the economy with a temporary, small positive boost at a time when it seems to be increasingly moving in the right direction," Archer said.

"The most obvious support to the economy coming from the royal birth will be some boost to retail sales through people buying souvenirs and commemorative items, while there is also likely to be a small lift to alcohol sales as some people will want to toast the royal baby," he added.

The baby would contribute to a general feel-good factor following recent British sporting successes such as Andy Murray winning Wimbledon, Chris Froome cycling to victory in the Tour de France, and the England cricket team's success so far in the Ashes series against Australia, said Archer.

The Centre for Retail Research, based in Nottingham, central England, estimated an extra £243 million in sales in July and August.

It predicted £87 million spent on royal baby celebrations -- much of it on alcohol -- £80 million on toys and souvenirs and £76 million on books, DVDs and newspapers.

Tourism officials said that while it was difficult to put an exact figure on the likely baby boost, Britain's cultural heritage as embodied in the royal family boosted the economy by £4.5 billion a year.

"While a living royal family gets us an enormous amount of free advertising for Britain around the world, it's not really something we can estimate a figure for and the international coverage alone is priceless," a Visit Britain spokesman said.

"We know that visitors drawn here by the appeal of our culture and heritage spend over £4.5 billion annually and support around 100,000 jobs," the spokesman added.

"Some of that figure can be attributed to attractions and events with a connection to Britain's monarchs past and present."