Bernard Durkan (Kildare North, Fine Gael)
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Question 244: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which policy has become more reliant on exports from the services sector; if studies have been carried out to identify the expected impact of higher costs in respect of exports in the service area; and if she will make a statement on the matter. [31509/08]

Bernard Durkan (Kildare North, Fine Gael)
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Question 246: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which the manufacturing sector has contributed to exports in each of the past five years; if the actions are being taken to address issues currently or likely to negatively impact on this sector in the future; and if she will make a statement on the matter. [31511/08]

Bernard Durkan (Kildare North, Fine Gael)
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Question 247: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the trend established in respect of export growth in each of the past five years; and if she will make a statement on the matter. [31512/08]

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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I propose to take Questions Nos. 244, 246 and 247 together.

In the period 2003-2007, annual growth in total Irish exports has averaged 6.7%. In relation to Merchandise exports, the growth has averaged 2%, while Services exports grew at an average of 15.3% during this period. Services exports have risen steadily from 31% of total exports in 2003 to 43% in 2007. Of total exports of €154.4bn in 2007, our trade surplus was an extremely healthy €23.3 bn, the biggest surplus in any of those 5 years. This very positive trend was achieved despite poor economic growth in many of our trading partners and also against the backdrop of adverse exchange rate trends in our two biggest export markets, the United States and the United Kingdom, due to the rise of the Euro against both the US Dollar and Sterling.

In relation to manufacturing, this sector is in transition but is well positioned to meet future challenges. Ireland's manufacturing future depends on a manufacturing sector that is capital intensive, knowledge intensive and skills intensive, focused on developing innovative products, services and solutions and meeting the needs of markets and customers. The report of the High Level Group on Manufacturing, which was launched by Minister Micheál Martin, in April last, identifies the focused actions needed by employers, employees and Government to respond to challenges and take advantage of opportunities to further develop the sector in Ireland.

That report contains 26 recommendations, directed at the key areas of:

Innovation and productivity, leading to transformational change.

Reskilling and management development for the innovative firm.

Increasing awareness and take-up of existing supports.

The restoration of cost competitiveness, which is of critical importance.

The establishment of a Manufacturing Forum to progress the implementation of the recommendations outlined in the report and to act as a strong advocate and champion for the manufacturing sector.

The Government is committed to ensuring that the recommendations of this Group receive a high level of priority to ensure that the manufacturing sector continues to evolve and to provide high value added and high quality employment for the future. The report is currently being considered by the Social Partnership Forum, as part of the ongoing review of "Towards 2016".

In relation to Services, almost two thirds of the Irish workforce is currently employed in services and Ireland is now the 10th highest exporter of services in the world. The future performance in services activities will therefore be increasingly important to overall growth in the economy.

The Services Strategy Group, which was set up last year by Forfas and my Department, published its report — "Catching the Wave: A Services Strategy for Ireland", earlier this month. The report sets out new policy proposals on how the State can ensure the continued development and growth of Ireland's services sector. It deals with the following issues:

The impact of services on the national economy

Developing a Strategic Framework for Services

Exploiting opportunities for services to optimise impact on the national economy

Putting in place a support framework

Implementing a Services Strategy.

The recommendations in this report will guide the development of our services strategy into the future, to exploit the opportunities that this sector presents.

Bernard Durkan (Kildare North, Fine Gael)
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Question 245: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which her policy is focused less on manufacturing; and if she will make a statement on the matter. [31510/08]

Mary Coughlan (Donegal South West, Fianna Fail)
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While the Services Sector is clearly an important and growing source of employment and exports, the Manufacturing Sector is and will continue to be an integral component of the Irish economy. The sector continues to be a significant employer — the latest available data on manufacturing employment compiled by the Central Statistics Office (Earnings and Labour Costs Release) published in May 2008 indicates that at Quarter 4 2007, there were over 225,000 persons directly employed in manufacturing which equates to 11% of total employment. In addition the sector sustains an additional 165,000 through secondary employment in associated services. In 2006 the sector was accountable for approx 23% of total economic output. Our manufacturing sector continues to perform strongly and 2007 represented a very good year with production growing by 7.5 per cent, the highest annual change since 2002.

Not only does manufacturing contribute directly to employment, economic output and exports but it is also a key driver of innovation and technological advance. It increases opportunities for attracting and embedding research and development activities, collaboration with the higher education sector and stimulating networks. Ireland's management capability, high quality outputs, productivity growth and project management skills have evolved as a result of our success in attracting high quality foreign direct investment in manufacturing and in stimulating the growth of indigenous firms with a focus on exports.

The manufacturing sector in Ireland has evolved noticeably since 2000, in terms of the composition of industry and the nature of activities, and is likely to continue to do so. The model of manufacturing in developed economies has changed and Irish enterprises are adapting to those changes and engaging in higher value added activities in order to compete in the global marketplace. In order to sustain and grow the sector, the Irish based manufacturing enterprises will have to continue the progression to high value added sectors and activities, and continue to increase productivity through investments in human capital, technology and innovation. Innovation and the productivity gains that flow from it are the new foundations for competitiveness. Irish manufacturers who engage in specialised, sophisticated, high technology and value added activities can continue to compete successfully on international markets.

The recently launched Report of the High-Level Manufacturing Group contains some 26 recommendations directed at key areas of innovation and productivity leading to transformational change, reskilling and management development for the innovative firm, increasing awareness and take up of existing supports. In addition the group recommends the establishment of a Manufacturing Forum to take responsibility to progress the implementation of the recommendations outlined in the report and to act as a strong advocate and champion for the manufacturing sector to ensure that manufacturing remains central to current and future industrial policy.

The Social Partners agreed, as part of the recently concluded review of Towards 2016. that a manufacturing Forum should be established in line with the recommendation of the High Level Group. This matter will be progressed by my department in consultation with the Department of An Taoiseach and the Social Partners.