A record 1,330 firms and 2,700 additional jobs were created in the small business sector in Northern Ireland last year, according to the latest figures.

The annual report from LEDU, the North's small business agency, shows the number of new firms established grew by 10 per cent last year.

Agency funding commitments for projects rose 20 per cent to £30 million sterling (#49 million) in total, to support the growth of small business whose investment in Northern Ireland grew to £100 million during 2000/2001.

More than half of LEDU's financial support was directed at firms located in underdeveloped parts of Northern Ireland, designated as New Targeting Social Need areas.

This is LEDU's last year in existence: the agency will merge with other economic development agencies to form a new super-agency, Invest Northern Ireland, later this year.

According to Mr Eamonn McElroy, chairman of LEDU, the final results from the agency show the small business sector is flourishing despite the current competitive economic climate.

But he believes that more needs to be done to encourage new entrepreneurs to go into business. "We need one, two or three big businesses to create spin-off opportunities for entrepreneurs in Northern Ireland. The high-tech area is a good example of where this could be achieved." LEDU's annual report shows turnover at LEDU's existing clients grew by 7.7 per cent last year, with export sales growing 10.8 per cent.

An independent Small Business Impact Study by the Northern Ireland Economic Research Centre has shown that in the period 1996-99 LEDU-assisted manufacturing businesses had growth rates three times the Northern Ireland and UK average and that they outperformed their counterparts in the Republic. The study, commissioned by LEDU, indicated small firms it assisted in the knowledge-based sectors grew four times faster than the Northern Ireland average and three times faster than that of the UK as a whole.