Shannon Development, which is currently the subject of a Government review, reported a small net increase of 29 jobs last year in firms it supports.

Total jobs created were 1,521 in assisted companies, bringing the total employed in such firms to almost 20,000.

The results reverse the trend of the previous three years. The agency said these companies generated sales of €4.4 billion and exports of €3 billion.

Announcing the end of year results, Shannon Development chief executive Mr Kevin Thompstone said there were strong indications that investment in the knowledge-based economy had started to pay off.

Mr Thompstone, who flies to China as part of a trade delegation led by the Taoiseach Mr Ahern this weekend, said the region was not competing with other Irish regions, but was competing globally to win business for Ireland. He said the State's business with China had increased tenfold, from €300 million a year to €3 billion a year since 1999.

"A significant portion of that was generated by companies in the Shannon region," he said.

Mr Thompstone said it would be a mistake if Shannon Airport was brought under the wing of Enterprise Ireland or IDA Ireland and its assets transferred to the new Shannon Airport Authority. Such suggestions have been made in a Government commissioned report.

In the past three years the assets of Shannon Development, which come largely from its property holdings in the Shannon free zone area and have a book value of €150 million, have been used to raise finance to develop technology infrastructure in the region.

This had included the region's towns initiative, the development of broadband infrastructure, the building of knowledge networks and other technology infrastructure. Mr Thompstone said the investment had helped to refocus the region on the knowledge based economy which had led to intense interest from the Chinese government and the growth of business between the region and China.

Shannon Development chairman Mr Liam McElligott said the agency was a different body from a State enterprise agency and had a broader role in economic development through partnerships with foreign direct investors, third-level colleges, local authorities and others.

Summing up the agency's performance in 2004 Mr Thompstone said: "Successful countries need strong regions and the unique potential of each region is best unlocked by strong regionally driven networks and partnerships. While he acknowledged that the year was a difficult one for tourism, he said new opportunities at Shannon Airport - such as the creation of a Ryanair hub - had the possibility of greatly increasing visitor numbers.

Mr Thompstone added: "2004 also saw a noteworthy increase in entrepreneurial activity in the start-up sector in the region and in the take-up of Shannon Development sponsored events and programmes aimed at assisting companies to access export markets.

"Shannon Development investment in its network of world class technology parks and business centres continued apace in 2004 with the construction of 46,000 sq ft of high-tech office space at Information Age Park in Ennis."