Exports by companies supported by Enterprise Ireland increased by 12 per cent to €11.8 billion last year and continue to hold up well despite concerns about the weak dollar, the organisation said yesterday.

Enterprise Ireland's annual report shows the companies that received grants through the agency spent €16 billion on home-sourced goods, services and payroll in 2006 and reported a 1,261 net increase in jobs.

New export sales generated last year reached €1.7 billion, with 284 companies securing international sales contracts for the first time.

But the euro's strength against the dollar, the rising cost of oil and the outcome of the World Trade Organisation trade negotiations will affect future export performance, Enterprise Ireland chief executive Frank Ryan said.

Irish companies need to differentiate themselves from the competition by embracing the business opportunities posed by climate change, he added.

The ways in which Irish businesses can benefit from "the increasing importance of the green agenda" are expected to be at the forefront of Enterprise Ireland's strategy for 2008-2010.

The details of the strategy will be announced in the autumn.

Minister for Enterprise, Trade and Employment Micheál Martin said Enterprise Ireland's target to increase export sales by €3 billion over a three-year period had almost been met after just two years.

"It is particularly gratifying for me to see the Irish-owned enterprise sector taking a central position as a major contributor to our continued economic prosperity," the Minister said.

Exports to the US by Enterprise Ireland's client companies grew by 12.5 per cent to €1.3 billion last year, which Mr Ryan said was "an excellent result" in a "challenging" market.

Asia is the fastest-growing export market for Irish companies, increasing by 24 per cent last year to €654 million.

Exports in the software, services and emerging sectors grew by 16 per cent to €1.4 billion, while the industrial and life sciences markets grew by almost 12 per cent to €2.5 billion.

But the food and retail consumer markets remain the Republic's largest export sector, rising by 11.4 per cent last year to €7.8 billion.

Enterprise Ireland singled out the strong export performance of drinks companies C&C and Diageo and Dawn Farm Foods, but said exports were not as concentrated on the food sector as they had been in the past.

"No longer are we dependent on one swallow to make a summer," Mr Ryan said.

Enterprise Ireland supported 76 new "high-potential start-ups" last year, investing €17.5 million. It also made major investments in eight growing companies identified as having the ability to grow their turnover to at least €20 million.

Some 194 research and development projects received a total of €53 million in support last year, while 155 applicants received a further €30 million through the agency's commercialisation fund.

More than €10 million was invested in commercial biotechnology research, while 19 companies were helped to secure an estimated €5.7 million worth of contracts with the European Space Agency.

Enterprise Ireland's London office is currently advising 50 companies about how to meet the environmental criteria required to bid for contracts for the London 2012 Olympics.

Building contracts for the games are estimated to be worth more than €7 billion over the next five years and it is hoped that Irish firms can win business worth several hundred million.

A British government plan to modernise schools in Britain is expected to yield even bigger opportunities for Irish building materials, Mr Ryan said, with companies such as Kingspan and CRH likely to benefit from the development.