It is ironic that, at the very time when our exports are down against the previous year continuing the trend started last October, the Government has made some extraordinary decisions which will undoubtedly have a further negative impact.

The mid-term review of EU structural funds carried out by the Economic and Social Research Institute, has given the Department of Finance the ammunition to remove 10 million ecu (£7.3 million) from the funds allocated for market development for the remainder of the current programme. The authors of the report argue that much of the market development sub-programme "is not truly a public good" - grants are provided from public funds, but most or all of the return will be private.

It is difficult to accept that the sector of our economy which generates more jobs than any other - one out of every two (Exports and Employment 1985-1995 Bacon and Walsh) - is not a public good. The amount of funds allocated for market development in the operational programme, which are administered by the Irish Trade Board, was in fact 1.7 per cent of the total, hardly an extravagant allocation.

To digress for a moment, had the Department of Finance been able to hedge against currency fluctuations, as they constantly advise exporters to do, we would save ourselves a possible shortfall of £250 million in Structural Funds arising from the Irish pound's appreciation against the ecu since late 1996. The second remarkable feature of what has been happening is the new arrangement of the Ministerial responsibility for Trade. The Department of Tourism and Trade has been demolished with the trade portfolio going into the new Department of Enterprise, Trade and Employment.

Nothing extraordinary about that, but fragmentation of operations within that Department is almost assured by splitting the trade brief. The Minister of State takes bilateral trade questions along with Labour and Consumer Affairs, while the Tanaiste takes responsibility for multilateral trade and the trade promotion agency - the Irish Trade Board. Each Minister is backed by separate assistant secretaries and other staff. These arrangements may reflect turf battles within the Department but there may be another agenda.

Ever since the Culliton Report recommended the merging of the Irish Export Board and the Industrial Development Authority - and which by an extraordinary feat of public sector architecture resulted in the creation of four from two, Forfas, Forbairt, IDA Ireland and the Irish Trade Board - there has been an idea amongst the mandarins that the Irish Trade Board should merge with Forbairt. (Never mind that the same period has seen the creation of a new trade promotion board for food - An Bord Bia). So this may well be the hidden agenda behind the Ministerial division of responsibilities. This would be a mistake.

Trade promotion is about finding opportunities for exporters and helping exporters into overseas markets. It is about market development, not company development. To work well, its services should be delivered by a small responsive organisation in an unbureaucratic way.

Most countries in Europe and the world have trade promotion organisations. Those that don't are in the process of setting them up. The Irish Trade Board may not be perfect - in fact our association has had to take issue publicly on some aspects of their operations recently - but it is a specialist agency in a highly specialised sphere of economic activity. A much more intelligent and modern alternative to merging into a large organisation would be a fuller collaboration with the private sector representative bodies under a board which represents the users of their services, rather than the usual politically inspired appointments.

A final thought. As a concession to repeated calls for a strategic approach to such matters, Partnership 2000 enshrines the commitment to focus on a statement of National Trade Policy, as well as a review of the effectiveness of current trade promotion. Both are eagerly awaited by the exporting sector, which will provide £8 million of the Irish Trade Board's 1997 spend of £42 million.

Colum MacDonnell is chief executive, Irish Exporters Association