More than three-quarters of Irish chief executives expect the Irish economy to slow further next year, with one in four forecasting a significant slowdown.

The Deloitte & Touche/Enterprise Ireland survey of 190 chief executives found that confidence in the economy had fallen significantly, from 65 per cent last year to 41 per cent this year.

The reduced rate of growth in the Irish economy is seen as the biggest threat to Irish businesses, a factor cited by 34 per cent of chief executives, with the slide in the US economy affecting 29 per cent of companies. Despite the expectation that the economy will deteriorate, 57 per cent of chief executives expect their sales to rise next year. European markets are now expected to provide the biggest opportunities for exporters.

The greatest challenge facing Irish companies in developing an overseas market is finance - mentioned by 22 per cent - followed by human resources issues. Fewer than one in 10 of the CEOs surveyed expected employment in the economy as a whole to rise next year. But 79 per cent expect non-wage costs to rise during 2002.

Managing partner with Deloitte & Touche Mr Pat Kenny said there was some brightness amid the gloom, with most chief executives expecting inflation rates to be lower in 2002 and predicting further falls in interest rates.

Chief executive of Enterprise Ireland Mr Dan Flinter said that, while companies were operating in a more turbulent environment, it was encouraging that many viewed Europe as affording the greatest potential for export growth.