Tag Archives: Retail market

News Ireland daily BLOG by Donie

Monday 9th May 2016

Irish households continue to cut its debt by repaying loans

Latest figures from Central Bank show households still third most indebted in the EU

    

Household debt has declined continuously for the last 29 quarters and has fallen by 26.6% since its peak. 

Irish household debt fell by 1.1% in the fourth quarter of last year as borrowers focused on repaying loans.

The latest figures from the Central Bank show household debt continued to decrease, falling by €1.6bn, or 1.1%, to €149.6bn.

This represented a household debt per capita of €32,269. Household debt is now at its lowest level since the first quarter of 2006.

The Central Bank said the decline over the quarter reflected net debt repayments (-€1.1bn) and debt write-downs (-€0.6bn), which were slightly offset by positive reclassifications (€0.1bn).

Household net worth increased by 1.4% to €626.1bn, or €135,078 per capita, during the same period. This increase was largely driven by a rise in housing asset values (€6.3bn), as well as a further decline in household liabilities (€1.6bn).

Compared to a post-crisis low of €444.0bn in the second quarter of 2012, household net worth has risen by 41%. However, it is still 12.8% lower than its pre-crisis peak of €718bn in the second quarter of 2007.

Household debt has declined continuously for the last 29 quarters and has fallen by 26.6% since its peak of €203.7bn in the third quarter of 2008.

Indicators of household debt sustainability continued to improve during the same period. Debt as a proportion of disposable income fell from 159.8% to 155.1%, reflecting both the decline in household debt, as well as strong growth in annualised disposable income.

Overall, the ratio of household debt to disposable income has fallen by 60.2% since its peak of 215.3% in the second quarter of 2011.

Debt as a proportion of total assets also decreased, falling to from 19.5% to 19.1% over the quarter.

Despite a “significant decline” in debt as a proportion of disposable income over the year to Q4, Irish households continued to be the third most indebted in the European Union. Irish household debt fell by 25.1 per points over the year.

The Central Bank noted this was “significantly more” than any other country examined.

Spanish and Portuguese household debt also fell considerably over the year declining by 6.1%% and 4.6% respectively.

Household investment in financial assets rose to €1.9bn. This represented the highest level of investment in financial assets by households since the third quarter of 2009.

The increase in financial assets over the quarter largely reflected transactions into deposits.

Investigation launched after death of a man in his (70s) in Garda custody

GSOC confirm Gardaí administered CPR after man ‘became unwell with breathing difficulties’ in a Garda cell.

   

The Garda Ombudsman has confirmed that they are investigating the death of a man in custody.

The man, who was in his 70s, was discovered dead in a cell at Westport Garda station in Co Mayo at 11am.

The man was detained earlier today and sources have indicated he may have suffered a heart attack.

A spokeswoman for the Garda Siochana Ombudsman Commission (GSOC) has confirmed that a team is on their way to the scene where an investigation will be carried out.

A referral was made to the body under section 102 of the Garda Síochána Act 2005.

This evening GSOC released a statement about the incident.

A statement?

A spokeswoman confirmed: “The Garda Ombudsman is examining the circumstances surrounding the death of a man in his 70s while in custody at Westport Garda Station, Co. Mayo.

“The incident was referred to GSOC by the Garda Síochána under section 102 of the Garda Síochána Act at about 12.30pm this afternoon.

“The man who was under arrest became unwell with breathing difficulties and CPR was administered by gardaí. A doctor and the emergency services were called and the man was pronounced dead at the scene.

“The State Pathologist has been informed and a post-mortem is scheduled to take place in Castlebar in the coming days.

“GSOC Investigators are at the scene and an independent examination is underway to establish the facts of the situation.”

The published Panama Papers reveals thousands of secret offshore companies

A searchable database displays more than 200,000 entities from the Panama Papers

     

The International Consortium of Investigative Journalists (ICIJ) tonight publishes a searchable database (https://offshoreleaks.icij.org) that strips away the secrecy of nearly 214,000 offshore entities created in 21 jurisdictions, from Nevada to Hong Kong and the British Virgin Islands.

The data, part of the Panama Papers investigation, is the largest ever release of information about offshore companies and the people behind them. This includes, when available, the names of the real owners of those opaque structures.

The database also displays information about more than 100,000 additional offshore entities the ICIJ had already disclosed in its 2013 Offshore Leaks investigation.

The Panama Papers database.  

(https://offshoreleaks.icij.org)

The ICIJ is publishing the information in the interest of the public .

The data the ICIJ is now making public represents a fraction of the Panama Papers, a trove of more than 11.5 million leaked files from the Panama-based law firm Mossack Fonseca, one of the world’s top creators of hard-to-trace companies, trusts and foundations.

The consortium is not publishing the totality of the leak, and it is not disclosing raw documents or personal information en masse. The database contains a great deal of information about company owners, proxies and intermediaries in secrecy jurisdictions, but it does not disclose bank accounts, email exchanges and financial transactions contained in the documents.

In all, the database reveals more than 360,000 names of people and companies behind secret offshore structures. As the data are from leaked sources and not a standardised registry, there may be some duplication of names.

The data was originally obtained from an anonymous source by reporters at the German newspaper Süeddeustche Zeitung, who asked ICIJ to organise a global reporting collaboration to analyse the files.

More than 370 reporters (https://panamapapers.icij.org/about.html) in nearly 80 countries investigated the files for a year. Their investigations uncovered the secret offshore holdings of 12 world leaders, more than 128 other politicians and scores of fraudsters, drug traffickers and other criminals whose companies had been blacklisted in the US and elsewhere.

Their status as outlaws or public officials did not prevent them from obtaining shell companies in locales where secrecy laws often make it impossible for prosecutors and other investigators to trace their assets.

The files revealed, for example, that associates of Russian President Vladimir Putin secretly shuffled as much as $2 billion through banks and shadow companies.

The Global reaction? 

The reaction to the Panama Papers was immediate and viral.

Outraged citizens took to the streets in Reykjavik, Malta and London while the hashtag #panamapapers trended on Twitter for days after the story broke on April 3rd.

The prime minister of Iceland resigned over the British Virgin Islands company he co-owned with his wife, while other world leaders scrambled to explain their secret holdings.

It took UK’s prime minister David Cameron three days to publicly acknowledge he had profited from an investment fund, created by his father, that was incorporated in Panama and managed in the Bahamas.

In Spain a minister resigned after being caught in a series of lies about his connections to offshore, and in Uruguay police arrested five individuals suspected of laundering money for a powerful Mexican drug cartel.

The Panama Papers underscore the fundamental injustices and inequalities created by the offshore system, media commentators and political leaders say.

“When taxes are evaded, when state assets are taken and put into these havens, all of these things can have a tremendous negative effect on our mission to end poverty and boost prosperity,”

Jim Yong Kim, the president of the World Bank, said as he opened the spring meetings of the World Bank and IMF in Washington soon after ICIJ and more than 100 other news organisations, including The Irish Times, began revealing the results of the media collaboration’s investigation.

President Barack Obama, meanwhile, pointed out that the biggest problem was that many of the schemes revealed by the Panama Papers were legal. “It’s not that they’re breaking the laws, it’s that the laws are so poorly designed,” he said.

The revelations reignited the debate about the need for public registries in which information about who ultimately controls a company be accessible to all. The UK has made disclosure of beneficial owner data mandatory and public, but British Overseas Territories such the British Virgin Islands and the Cayman Islands, some the busiest offshore havens, have agreed to share that information by law enforcement.

Citing the Panama Papers, the US government also announced on Thursday that it has sent legislation to Congress to create a centralised federal registry of the actual owners of any newly created company.

The registry would help law enforcement authorities ferret out the real people behind anonymous companies used in money laundering and other wrongdoing.

The governments of Australia and Germany have said that they too intend to create public registries of company owners.

On Friday, the anonymous leaker of the Panama Papers, known only as “John Doe, ” spoke publicly for the first time in a written statement and called out for concrete steps to combat tax havens .

“In the European Union, every member state’s corporate register should be freely accessible, with detailed data plainly available on ultimate beneficial owners,” the source wrote. Doe added that the US “can clearly no longer trust its fifty states to make sound decisions about their own corporate data.”

Exploring the database? 

(https://offshoreleaks.icij.org)

The searchable database that ICIJ publishes today allows users to explore the networks of companies and people that used – and sometimes abused – the secrecy of offshore locales with the help of Mossack Fonseca and other intermediaries. The leaked data covers nearly 40 years, from 1977 through the end of 2015.

The data, which includes postal addresses, displays links to more than 200 countries and territories, from China to Chile.

Users can filter the information by country and by offshore jurisdiction. They can also explore the role of banks, law firms and other gatekeepers of the financial system in facilitating the creation of offshore companies for high net worth individuals.

For the first time, they can see details about shadowy Panamanian private foundations, including when available information about who controls them.

While the database opens up a world that has never been shown in this much detail, not every owner of a company that appears in the Panama Papers shows up in the public database.

This is because ownership information is often buried in emails, power-of-attorney letters and internal notes of Mossack Fonseca employees and cannot easily be extracted in a systematic manner.

In addition, Mossack Fonseca often failed to collect the necessary information about the ultimate owners of companies, relying instead on banks and other intermediaries to keep track of that essential data.

Still, it is expected that Panama Papers revelations will continue to surface as regulators and ordinary citizens from around the globe probe the newly available data and find new connections that may have escaped reporters. Concerned citizens are encouraged to share tips with ICIJ and the Panama Papers journalists who continue to investigate the documents. The full dataset is also available for download: https://offshoreleaks.icij.org/pages/database.

“Transparency is not going to move backward,” Kim said in his World Bank spring meetings remarks, warning that those trying to avoid taxes or steal money from public treasuries should be “very careful” because they will eventually be tracked down.

“The world is only going to become more and more transparent as we move forward.”

Aldi and Lidl prove incredibly astute at tapping into what Irish consumers want

Irish consumers moving to own-brand offerings is no surprise

    

Irish consumers are now discarding brand names more in favour of the own-brand offerings on the shelves of Aldi and Lidl in greater numbers than ever should come as no surprise.

The share of the Irish grocery market held by the German discounters Aldiand Lidl has just increased dramatically, with confirmation due on Monday that nearly one in four Irish consumers do their shopping in either one of the two stores.

Last month, figures from industry analysts Kantar Worldpanel painted a very different picture.

Those figures put Supervalu on 24.9% of the Irish market, while Tesco had 23.9% -just 0.4% ahead of Dunnes Stores.

Lidl and Aldi had 8.5% and 8.4% market share respectively – good certainly, but nowhere as near as good as the new figures suggest.

The change is due to a recalibration from Kantar rather than any shift in spending.

There is no change in the running order, with Supervalu still in the number one position and Aldi still in fifth – but the combined market share of Aldi and Lidl is 22.1%. Lidl now has 11.5% of the Irish market, while Aldi is just behind it on 11.2%.

Aldi is arguably the better performing of the pair, because it has an almost identical market share with significantly fewer stores.

Brand names:  That Irish consumers are eschewing brand names in favour of the own-brand offerings on the shelves of Aldi and Lidl in greater numbers than ever should come as no surprise.

In the mid-1990s, Lidl and Aldi were unfamiliar to most Irish shoppers. Then, in 1998, Lidl arrived and was joined the following year by Aldi.

In the early days growth was slow, with Irish people reluctant to swap branded products for unfamiliar labels, while Irish suppliers and producers were reluctant to do business with untested chains who were not highly regarded among shoppers.

People were amused by the pair’s eclectic weekly special offer – but the allure of delights such as jackhammers jostling for position with canoes, luridly coloured onesies and flat-pack gazebos was not enough to bring people through their doors in significant numbers.

Their Spartan shelves did Lidl and Aldi no favours either. A big Tesco outlet might have more than 20,000 different items on their shelves, while the discounters contented themselves with around 1,000.

Then the bubble burst – and everything changed. The growth of both retailers has been relentless ever since but it would be wrong to suggest that growth has been simply down to cash strapped times. Far from it.

Both Aldi and Lidl have proved themselves to be incredibly astute at tapping into what Irish consumers want. They tweaked their product lines to offer more Irish produce, their ranges improved dramatically and they established very good relationships with Irish suppliers.

Crucially, both Aldi and Lidl were also able to prove that people who did their shopping in their stores saved money, a lot of money.

Canny shoppers realised they could easily knock over a third off their annual grocery spend by shopping with the Germans, without sacrificing anything significant in terms of quality.

The perception of both companies is also very good. Both featured in the top 10 most respected companies in the Republic in a survey published last month by the Reputations Agency, while a separate survey from Amárach on consumers’ attitudes published late last year rated Aldi fourth most highly rated company in Ireland in a poll of more than 2,700 people.

“That really surprised me,” said Gerard O’Neill of Amárach when the survey was published.

“We lived through the recession and watched as the discounters changed the retail rules and relentlessly pushed down prices, but now they are changing the rules again. They are aiming for better prices, better experiences, and better service.”

Speaking yesterday, O’Neill elaborated. “The recession gave them [discounters] a foothold – but there is more to it than that. They have completely changed the conversation about value and made people realise it is not all about price.

“It is about affordability, but also about the sense of how a person feels shopping. Aldi and Lidl have made people who shop in their stores feel prudent, discerning, more astute – almost German.”

O’Neill said the two had been “very clever in how they have dealt with their competition. It has been like a bait and switch. They made the conversation about price and then switched it to Irishness and community.

“If a Martian was to arrive in Ireland they would be sure that both Aldi and Lidl were indigenous companies, so embedded in the local communities do they appear,” he suggested.

Customer experience

He pointed out that customer experience “is driven not by value for money – because we rationalise that after the fact – but by something more emotional. We like to come away from the shopping experience feeling smug – in the nice sense of the word – and safe in the knowledge that we have got a bargain. Aldi and Lidl understand that.”

It is not just by offering good value and toying with our emotions that Aldi and Lidl have grown so strongly. Both have opened stores at a phenomenal rate.

Last Thursday, the former opened its 124th – and largest – store in Sallynogginin Co Dublin, while Lidl has 147 stores.

Both have plans for more openings in the months ahead.

Damian O’Reilly, who lectures in retail management in the Dublin Institute of Management, described how effectively the discounters have been playing the retail game in recent years, capitalising on changing economic conditions, improving consumer knowledge and very effective store design and stock maintenance.

He pointed out that their modular units were very cheap to put up – a store can be opened for about €3 million – and their compact size means they can be squeezed into small spaces in rural towns which has allowed them to take on Supervalu in areas where that retailer used to be traditionally untouchable.

And, he said, Aldi and Lidl have been outspending their rivals on television and newspaper ads over the last two years, working relentlessly to promote their Irishness.

They also have some canny tricks they play. “They have longer conveyor belts leading to the cash registers, so shoppers think they are nearly there when they start putting their shopping out – even though there might still be three people ahead of them. The staff have to scan 30 items a minute – so the check-out process moves very quickly.”

But where to next? “In terms of market share I think they are nearly there,” O’Reilly says. “They might be able to grow another couple of per cent but the rate at which they are opening stores is slowing and that will put a limit on how much they will grow.”

O’Neill agreed, although he suggested the Germans could get to 30% of the market. “They will be constrained by the amount of real estate they can buy and the competition is not just going to sit there and watch as they grow bigger.”

Full moons influence less sleep in children

    

The full moon can somehow influence children’s behaviour and even affect their sleep? although it is not enough to strengthen ancient belief on the lunar phases’ effects on human biology.

A recent study published in the journal Frontiers in Pediatrics showed that children are no more active during full moon than in any other phase of the moon. The full moon, on the other hand, may interfere with their sleeping time, potentially owing to its brightness particularly “if the window curtain is not sufficiently opaque.”

“[S]leep duration was 1 percent shorter at full moon compared to new moon, while activity behaviours were not significantly associated with the lunar cycle in this global sample of children,” wrote the researchers, with this specific finding translating to around five minutes less sleep.

According to researchers from the Children’s Hospital of Eastern Ontario Research Institute in Canada, the study offers “solid evidence” that the links between moon phases and children’s sleep duration and activity behaviors do not come across as meaningful from a public health perspective.

The team analyzed data from over 5,800 children, who were ages 9 to 11 and came from 12 countries. Unlike previous research relying on human judgment, subjects wore accelerometers, which are akin to fitness trackers recording body movements or monitoring sleep for 24 hours a day for at least seven days.

The kids got five minutes shorter sleep on nights with a full moon, deemed an effect “unlikely to be important.” And it remains unclear why children had less shuteye on full-moon nights.

 It could be that the full moon’s brightness was interfering with sleep, although the researchers considered this implausible given the abundance of artificial light – such as from smartphones and mobile devices – in modern societies.

The team urged future studies to see if the human body is somehow synchronized with the moon’s cycles, or if the full moon has a more pronounced effect on certain groups of people.

The belief that the moon affects people’s behavior dates back ancient times, although studies have seen little evidence to back up this idea. The moon mystery, suffice it to say, has fascinated many civilizations and generations.

For instance, no peer-reviewed study yet has seen any notable association between the full moon and epileptic seizures, psychiatric ward visits, or emergency room cases. Even when it comes to menstrual cycles, there is no research so far that makes a significant correlation between lunar phases and the condition across a huge swath of participants.

In addition, the effects of the moon on the ocean are notable not only during the full moon – the tides, too, are highest during the new moon.

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Ireland daily news BLOG by Donie

Tuesday/Wednesday 13 & 14th May 2015

Irish State’s elderly population set to increase significantly in next 45 years

 

A new EU report has said that the Republic’s elderly population is set to increase dramatically over the next 45 years.

The Irish State’s pension problems may be due to get worse, with new figures showing that the Republic’s elderly population is set to increase dramatically over the next 45 years.

The European Commission’s 2015 Ageing Report, published today, shows the national population is expected to rise to 5.3 million by 2060, with average life expectancy increasing from 79 to 85 for men and from 83 to 89 for women.

The elderly population, currently classified as those aged 80 and over, will rise from its current population share of 2.9% to as high as 10.2% over the same period.

Public spending demands will rise accordingly in the areas of healthcare and pension payments, the report says.

Unemployment benefits

Spending on unemployment benefits, however, will most likely decrease due to a decline in the younger population.

The report says that those aged up to 14 years will fall in proportional terms from 21.9% to 18.5% of the population, with unemployment rates in the 20 to 64 age bracket expected to decrease from 12.8% in 2013 to 6.5% in 2060.

In broader terms, the EU population is projected to increase by almost 5%, rising from 507 million in 2013 to as high as 526 million by 2050.

A decline in population to about 523 million is then forecast over the following decade, although that figure may be altered by variations due to immigration.

According to these projections, the UK would become the most populous country in the EU by 2060, with about 80 million people, followed by France (76 million), Germany(71 million), Italy (66 million) and Spain (46 million).

SuperValu and Tesco on Irish retailer’s top spot

  

The Irish supermarkets SuperValu and Tesco have now 25% market share each and are tied in first place, according to the latest figures from Kantor for the 12 weeks ending April.

“Over the past 12 weeks SuperValu and Tesco have each captured 25% of the grocery market, with SuperValu battling to hold on to the number one position it claimed last month and Tesco aiming to recover lost ground,” said David Berry, director at Kantar Worldpanel.

Among the big three retailers, Dunnes has posted the strongest sales growth of 3.6%, lifting its market share from 21.5% to 22%.

Dunnes has been benefiting from an offer that gives hefty discounts to customers who make big purchases.

It wasn’t good news for everybody.

“One of the most interesting trends in the latest data is the slowing growth rate of bothAldi and Lidl,” he added.

“While the 8.8% growth posted by Aldi and 7.8% for Lidl remains impressive, this is the first time since 2010 that both Aldi and Lidl have grown their sales by less than 10%.”

Classroom internet access linked to much higher Irish schools sucess test scores

 

Schools teaching design and graphics programme set to benefit from €7m in grants.

Researchers said “we cannot be certain that the use of internet in the class caused” the higher scores but a strong “relationship” was identified.

Primary school children who used the internet in the classroom had significantly higher mathematics and reading scores on average than peers who had no online access, a study by the Economic and Social Research Institute (ESRI) has found.

The researchers said “we cannot be certain that the use of internet in the class caused” the higher scores but there was a strong “relationship” identified.

The study comes amid further investment in technology in schools, with the announcement of €7 million in grants to post-primary schools to support the implementation of Design and Communication Graphics (DCG) curriculum.

Minister for Education and Skills Jan O’Sullivan announced the funding on Tuesday, which will see 450 schools get an average of €15,560 for the purchase of computers and software to encourage more students to take DCG in the Leaving Cert.

The ESRI study, published in the ‘Economic and Social Review’, identified “encouraging” returns from the state’s investment of €30 million in primary school broadband between 2005 and 2008.

The researchers found “no evidence for Ireland of the negative effects of broadband in schools reported in some studies internationally” but cited a time lapse in the positive results filtering through here.

“We found that on average teachers were more than twice as likely to use the internet in class after broadband service was installed under the programme, but it took about two years for this gain to emerge.

“This is not surprising, because it takes time for teachers to learn to use new technologies and to change their teaching practices.

“In addition, teachers in schools with better computer-related facilities were also more likely to use the internet in class.”

While many teachers and pupils express frustration at slow broadband speeds, the researchers found that having a faster connection speed had no statistically significant effect on educational outcomes.

Of the scale of these improvements, the authors noted, “the average difference in mathematics test scores between children in classes with and without internet use was as big as the rise enjoyed by children whose mothers had completed a degree rather than finishing at the Leaving Cert”.

ESRI and TCD researcher Seán Lyons, one of the authors of the study, said “we think the effect of the internet in the classroom depends on the context, and the way it’s used.

“So it may even differ from one school to another, and certainly from one country to another.”

A study in Portugal last year found that the roll out of broadband in schools led to negative educational outcomes for both male and female pupils.

But Mr Lyons said Portuguese schools appeared to have brought in internet access “in an unrestrictive way”.

The negative impact had been greatest in Portuguese schools where pupils were allowed to access websites such as YouTube.

For the study, the team of researchers, comprising Mr Lyons, Marie Hyland, Richard Layte, Selina McCoy and Mary Silles, examined data from standardised test scores, statistics on the broadband rollout, and figures from the Growing Up in Ireland survey.

Announcing the grants for the DCG programme, Minister for Education and Skills Jan O’Sullivan says the subject incorporated principles of science, materials, manufacture, design, technology and information technology and as such “directly contributes to the key skills required in Ireland’s knowledge-based economy”.

In 2012, 5,319 candidates sat the exam, with the predicted 2015 figure standing at 5,705.

“The allocated funding has been increased accordingly and will ensure that this important subject continues to go from strength to strength,” she said.

Letters will issue to schools detailing the amount of money they’re being allocated, based on the number of students who had taken the subject in the past three-four years.

The Department has also purchased support software from Solid Solutions Ireland for six years and three months, at a cost of €299,000.

Tourism Ireland Board Meets in Sligo

  

The Sligo Park Hotel was the venue for the May board meeting of Tourism Ireland, which took place on Thursday, 7th May.

The board members took the opportunity to meet with local tourism operators prior to the meeting, to discuss the upcoming peak season and the extensive promotional programme which Tourism Ireland is undertaking to highlight Sligo, the North West and the island of Ireland around the world this year.

Speaking after the board meeting, Niall Gibbons, CEO of Tourism Ireland, said: “We were delighted to be in Sligo for this month’s board meeting and to have the chance to meet with representatives of the tourism industry from Sligo and to hear directly how business is shaping up for the upcoming peak season.”

Man falls flat on his face behind Vincent Browne live on air

  

TV3 broadcaster Vincent Browne can’t help but chuckle when somebody faceplants behind him as he says his intro on Tonight with Vincent Browne.

During the opening of the show, which was broadcast from the Headfort Arms Hotel in Kells, the unlucky man stumbles and falls, landing at the presenter’s feet, prompting

https://www.youtube.com/watch?v=opGudV7EhXM

Vincent to look down in surprise and exclaim, “Somebody’s just fallen down beside me” much to the delight of audience and guests alike.

Robot pets way of future, could change human relationship with animals, researcher says

  

Robot pets could be common place in 10 years’ time and change the way we interact and relate with the real things, a Melbourne researcher believes.

Dr Jean-Loup Rault from Melbourne University studies animal welfare and the way humans and animals interact with each other.

Recently, he has been looking into how technology has changed the way we relate to animals and pets.

“We know very little about robotic pets, virtual animals online and what they actually do to people,” Dr Rault said.

“Is that going to change the way we relate to animals? Can that be a substitute to a live pet?

“Technology is moving very fast. The Tamagotchi in the early 1990s was really a prototype of a robotic pet and now Sony and other big companies have elaborated a lot on what have become robotic animals.”

He said humans were able to become emotionally attached to objects.

“There’s anecdotal evidence and a few studies that show people actually develop a bond, some kind of emotional attachment to those robots,” Dr Rault said.

“They know it’s not a live pet, they don’t consider it as a live animal but they also don’t consider it a mere object.

“It has an intermittent status between that of an animal and that of an object that projects some kind of personality.”

Dr Rault said robot pets could suit someone living in inner-city or high-density areas, as well as those with allergies and who were unable to look after a live animal.

But robotics expert Professor Maurice Pagnucco from the School of Computer Science and Engineering at the University of New South Wales said there was still a big gap between the current technology and a “virtual pet”.

“I don’t think we’re at the point where you could have a reliable pet,” he said.

“They wouldn’t be at the same level as a real pet, at the moment they’re basically toys.

“But where we’ll be in the future, we can’t really say.”

Technology ‘now part of our normal lives’

Dr Rault said the growing popularity of robot pets also raised questions about the way humans developed socially.

“There are school programs that use animals to teach children about responsibility, if you replace those live animals with robotic animals that don’t need to feed, you just plug them in and turn them off, is that the same thing?” he said.

“Are they going to develop in a different way?

Maybe you have a dog that stays at home when you’re at work so you buy it a robotic companion, so it interacts with it when you’re gone.

Dr Jean-Loup Rault, researcher

“It raises some major ethical questions in the same way that Facebook has – does interacting with others on the site actually make you social or less social?”

Dr Rault said robot pets could also have a positive effect, with robotic baby seals being used in the United States to help people with Alzheimer’s.

“They found out if you gave them a robotic baby seal, people would interact with it and derive some benefits from it,” he said.

“Maybe you have a dog that stays at home when you’re at work so you buy it a robotic companion, so it interacts with it when you’re gone and it keep it company.

“It’s not replacing anything that we have, it’s creating something new.

“Now we think as them as strange, weird and perhaps creepy, but in 10 years’ time people may think it’s normal.

“The new generation is very different. This technology is part of their lives, it’s not seen as something extra.

“Will it change the way we interact with real animals? A difficult question to ask, but it is an interesting one.”