Forfas yesterday provided further evidence of the Republic's economic boom, announcing that corporation tax brought in a record £2 billion-plus (#2.54 billion) last year, with almost half coming from international companies paying the special 10 per cent rate. But the State agency for industrial policy warned that the Republic risked becoming uncompetitive without another national partnership agreement.

In its annual review and outlook statement, Forfas said the total corporation tax take, in real terms, amounted to almost five times the level paid in 1988. The proportion from foreign companies paying at the 10 per cent rate was 45 per cent, up from 40 per cent in 1992.

"[These] manufacturing and internationally traded services companies spent more than £23 billion in the Irish economy in 1997 - up £2.5 billion or 11 per cent on 1996 and representing a rate of spending which does much to generate additional jobs throughout all sectors of the economy," Forfas said.

New jobs created approached 29,000 in 1998, the highest figure over the past decade, Forfas said, and total permanent employment in companies backed by IDA Ireland and Enterprise Ireland rose almost 13,000 to 250,000. International financial services accounted for 60 per cent of this growth.

Job losses also grew, however, reaching 16,000 compared to 13,000 in 1997.

"The increase in job losses in 1998 reflects the impact of unfavourable international market conditions on overseas and Irish-owned companies," the agency added.

Forfas chief executive Mr John Travers said the Government's decision to reduce corporation tax to 12.5 per cent would ensure the continued flow of investment and jobs in the Irish economy.