The Republic has lost out to Slovakia in a €100 million investment that would see the creation of 1,000 jobs.

Sky Media Manufacturing, a Swiss-based producer of recordable CDs and DVDs, considered locating in the vacant Eastman Kodak plant in Youghal, Co Cork, but despite being courted by IDA Ireland, opted for the west Slovak city of Nove Mesto nad Vahom.

The wages disparity between the Republic and eastern Europe was a deciding factor, the IDA admitted.

Talks were held with Sky Media on several occasions but the agency could not offer a package commensurate with that on the table in Slovakia.

"This was a high-volume low- margin enterprise so eastern Europe had huge advantages in terms of cost," said a spokesman for the authority.

The plant, which is due to come on line in October, will be the fourth-largest of its kind in the world.

The blow comes just weeks after electronics giant Philips announced plans to move its back-office operations from Dublin to Poland.

Philips said lower costs in Poland were "impossible to ignore" and wages were half those in the Republic.

The Dublin operation provided Philips's consumer electronics division with various accounting supports. This accounting operation will now transfer to Lodz in Poland

Unemployment crept upwards for the first time in seven months in January. The jobless rate now stands at 4.7 per cent, new Central Statistics Office (CSO) data show.

Sky Media is the latest multinational to invest in Slovakia, which has become increasingly attractive because of its cheap labour, proximity to western and eastern European markets and imminent EU membership.

Eastman Kodak shut its Youghal factory last February, with 230 lay-offs.