Reaching Government tourism targets for the coming years is contingent on a number of infrastructural issues being resolved, Fáilte Ireland said yesterday.

Fáilte Ireland chairwoman Ms Gillian Bowler also said that the continuing divergence between the east and west in terms of tourism, was the "overriding strategic issue" facing the sector.

At a conference on its 2004 review and outlook for 2005, Fáilte Ireland said visitor numbers were up 3 per cent last year, to 6.4 million.

The target for 2004 was a 4 per cent increase.

Growth in earnings did not keep pace with visitor number growth. Foreign exchange earnings were up just 2 per cent, to €4.2 billion.

It is Government policy to double visitor numbers and tourism earnings, in the period 2002 to 2012. Mr Shaun Quinn, chief executive of Fáilte Ireland, said Ireland was behind on revenue growth but the visitors' target was still achievable. However, this depended on a number of infrastructural issues.

Ms Bowler said there had still not been a decision on a second, low cost, quick turnaround terminal at Dublin Airport, which she said would make a significant difference. She called for a decision on the matter this year.

"The development of Shannon as a hub for European flights is a huge step in the right direction," she said. If Ryanair was successful at Shannon, it could lead to other low cost airlines flying into other regional airports.

The other infrastructural issue mentioned was the development of a Western Corridor.

Figures released yesterday showed the combined visitor and domestic spend on tourism in Ireland in 2004 exceeded €5.2 billion. Research has found that 97 per cent of visitors would recommend a holiday in Ireland.

There was a growing number of short break visitors who tended to come to Dublin and were not venturing outside the capital. While the numbers visiting Dublin were up, and the numbers visiting other urban centres were holding, the numbers visiting rural Ireland were dropping.

Hotel and self-catering numbers were growing, but the numbers staying at guest houses and B&Bs were dropping.

Visitors who had concerns about costs in Ireland were more concerned by general costs, such as the price of alcohol or meals out, than by costs such as accommodation or car hire.

The growth of short break holidays was creating quite a regional issue in the Irish tourism industry, Mr Quinn said, with most such tourists travelling to and only staying in Dublin. He said he hoped the Ryanair flights into Shannon would help "turn the corner" in terms of regional development of the industry.

Among the initiatives Fáilte Ireland plans for 2005 are the rebranding of B&Bs and renewed development of activity holidays.

Ms Bowler said the better-run B&Bs had done very well in 2004, having better occupancy rates than hotels.

The ageing European population meant that in the coming years, the numbers going on tours as against short break holidays would grow, helping to address the regional imbalance in the Irish tourism sector, Mr Quinn said.