Manufacturing production last year was up 7.4 per cent on 2006, the strongest yearly increase since 2002, provisional figures released by the Central Statistics Office (CSO) yesterday indicate. Colm Keenareports.

Output in the "modern" sector - comprising a number of high-technology and chemical industries - was up 9.1 per cent on 2006, again the strongest performance since 2002.

Industrial output as a whole was up 7.2 per cent.

However, the figures for December and the final quarter of 2007 both reflected a slowdown in pace, which economist Alan McQuaid of Bloxham said showed "clouds darkening" for 2008.

Manufacturing production was down 2.4 per cent in the final quarter when compared with the preceding quarter.

Manufacturing production in December was 0.9 per cent up on December 2006, an outcome that does not compare favourably with the increases in October and November, which both brought double-digit rises.

For 2007 as a whole, the increase in output in the traditional, and generally indigenous, sector was 2.5 per cent, the CSO figures show. The December increase was 0.1 per cent, an improvement on the slight negatives recorded for October and November.

Mr McQuaid, in his commentary, said recent purchasing managers index figures did not augur well for 2008 but added that, overall "we still think the manufacturing sector will post a positive average annual increase this year, but only half that recorded in 2007".