Telecom Eireann is expected to announce further price reductions for business and residential users from next week.

Speaking at a seminar in Dublin City University yesterday, the company's chairman, Mr Ron Bolger, said that further cuts were on the way.

The company wouldn't comment further on the extent of the cuts but it is understood they will be aimed at long-distance calls for residential and commercial users and are part of the overall £130 million package signalled earlier this year.

It follows the introduction last June of a special weekend rate for international calls and the reduction last July by one-third of the cost of accessing the Internet during peak hours.

At that time, Telecom said it would introduce other initiatives before the end of the year including discount schemes for business and residential users and reductions in the price of ISDN services, peak-rate local calls and trunk calls within Ireland.

The proposed reductions were welcomed by the Minister for Public Enterprise, Ms O'Rourke, who said low telecommunications costs were vital to promoting Ireland as a hub of electronic commerce.

She said she was hopeful Telecom might also introduce a flat-rate access charge to the Internet as a means of lowering email connection and running costs for companies.

Speaking at the DCU seminar, "Creating the Future", Ms O'Rourke said telecommunications and information technology were vital to Ireland's future prosperity.

She said electronics products accounted for one third of Ireland's total exports with companies based here supplying almost one third of all PCs sold in Europe.

She added: "The sale of Cablelink, the flotation of Telecom Eireann next year and the other changes in the telecommunications area have sent a message to many outside these shores that we are a country in which you can do business."