Any deterioration in the performance of the high-tech sector could seriously undermine the economy, according to Mr Jim O'Hara, the new chairman of ICT Ireland, the IBEC association representing firms in the high-tech sector. A range of policy priorities now need to be urgently addressed to support the sector, he said yesterday.

The information and communications technology (ICT) sector has been one of the key drivers of economic activity, and now comprises more than 1,000 organisations which employ 100,000 people directly, says Mr O'Hara, who is also general manager of Intel Ireland.

There has been a huge shift in the ICT industry in the past few years, he said, imposing new investment priorities on the industry. Demand will recover, he said in a statement, and "Ireland must act now and ensure that we have a world-class environment for investment during any future expansion". Mr O'Hara identified several priorities for doing this.

He said the industry profile needed to be raised, to ensure it received the appropriate policy consideration.

He also called for a much more aggressive expansion of eGovernment through the adoption of online information and Web-based application procedures by Government departments.

Policy also needs to sustain and develop the IT skills base, he believes, while PC penetration and high-speed internet access need to be increased.

Finally, he called for a new emphasis on encouraging research and development in the industry, to encourage a move up the "value chain" for the industry in Ireland. Development of centres of excellence in particular niches should be a key aim, he said, to secure the Republic's place as a centre for innovation and to lay the base for future job creation in the sector.