For decades, Newry has pioneered Northern Ireland's trade and commercial relationship with the Irish Republic. The possibilities presented by a new mutually beneficial relationship between North and South following the 1998 Good Friday Agreement have already manifested in the most comprehensive locally driven programme of Cross Border Trade development activity in Ireland. These activities include the Newry/Dundalk Business Linkages Programme, the innovative PLATO Programme; the Newry/Dundalk Steering Committee established in 1994, the Product Transfer Programme, the Newry & Mourne District Council/Louth County Council Steering Committee and the local authority led East Border Region Committee. It is believed that Newry has demonstrated itself to be the economic pivot between the North and South of Ireland and that it is the obvious, most economic, efficient and effective location to facilitate economic collaboration between the North and South of Ireland.

Due to the decline of traditional industries and social problems, the local economy suffered in the 1970's and 1980's. However there has been a significant upturn in economic regeneration in the 1990's with unemployment falling from 21.8% in 1991 to 6.0% in November 2002. The reduction of unemployment must also be viewed against the fact that Newry has an exceptionally young population with 1,900 school leavers joining the market each year.

The Newry area has an abundance of competitive skilled labour available, with 33% of the population being under the age of 15. The area has an excellent infrastructure to support industry and in recent years significant private sector and public sector investment has taken place.