A clampdown on software piracy could create 2,400 jobs and boost GNP by €690 million, technology analysts said yesterday.

Reducing piracy in the Republic would increase imports, strengthen competitiveness and enable companies to compete on an even footing with rivals in countries where piracy rates are much lower, according to IT consultants IDC.

Although software piracy levels in the State are, at 42 per cent, no longer the EU's highest, there is scope for further decreases, according to IDC.

A survey of 57 countries found indigenous firms stand to benefit most from a fall in the use of illicit software, said IDC analyst Ms Vicky Hawksworth.

"Local industry would gain more than the multinational importers, mostly because so many of the benefits would accrue to local services and distribution companies, and because local software firms, who can't spread their risk across geographies with lower piracy rates, would have the wherewithal to re-invest in their business," she said. Software piracy fell to 42 per cent in the six years to 2000. Over that period the industry grew 30 per cent, creating 7,500 new jobs, said the Irish Business Software Alliance, which commissioned the IDC study.

"Strong intellectual property protections spur creativity, which opens new opportunities for business, government and workers," said Mr Julian McMenamin, alliance chairman. "When local entrepreneurs have a legitimate way to sell their innovations and make a profit from their development, they can grow their own businesses and hire more people."

The survey found that 98 per cent of businesses use computers and that, despite the economic downturn, 67 per cent of companies invested in IT last year.