IRELAND NOT CREATING NEW BUSINESSES - An international advisor to Irish government and State agencies has warned that Irish businesses lack the confidence to become world business leaders.

Innovation expert Professor Danny Breznitz of the Georgia Institute of Technology says our research infrastructure is too narrow in its focus and may not be sustainable.

He says we are not creating enough new businesses, and when new businesses are set up, the financial supports are not there to keep them innovating.

Danny Breznitz says the building of Ireland's R&D infrastructure is something that should be imitated by other countries, but he said he feared that Irish research is too narrowly focussed on biotech and the ICT, or information and communications technology industries.

Professor Breznitz said that if a country wants sustained economic growth it has to focus on innovation, not only on the research side but on the commercialisation and the growth of productivity.

He says the grants system, which was built by 'historical accident', needs to be rethought to fit the current nature of Irish businesses.

He says that since 2001, there have been no new big Irish IT firms like Baltimore or Iona.

He says more companies must be formed and there should be more confidence in the system, both on the side of entrepreneurs and the Venture Capitalists, and a self assurance in them on the part of the State, that will allow them to grow and give them support.

Mr Breznitz says there have been some successes in nurturing the growth of our IT industry.

He says multinationals have been changing what they do in Ireland since when they first came here.

They have been creating jobs and encouraging R&D, and if that was only down to a tax regime none of those companies would have stayed, he says.

The tax regime is a 'seductive present' to encourage them here, but they would not stay unless there was something else to offer, he says.

Professor Breznitz is in Dublin for the next few days to meet government and its agencies and advise them on strategies to encourage the growth of high technology industries.

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NEWS IN BRIEF - Exchequer figures for May released last evening show that tax revenues were behind government targets in the first five months of the year, and the property related taxes are to blame.

Davy Stockbrokers warns that the housing downturn could mean that full year tax revenues will also miss government forecasts.

Last month stamp duties fell by 9.6%, the biggest fall in any month since August 2002, and the rate of growth over the five month period was the slowest in five years.

Overall, from January to May tax receipts were 9.6% higher than last year, the target was 9.7%.

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Two hundred jobs at Vodafone are set to be outsourced to IBM following a similar move last week from O2 for 450 of its staff. Vodafone says 130 contractors and 30 staff will go to IBM as the mobile operator tries to cut costs.

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MARKETS - Overnight the US markets took a dip as Federal Reserve chief Ben Bernanke said the economy should grow at a 'moderate' pace in the next few quarters, strengthening the belief that rate cuts there are less likely.

In Asian trade this morning the Hang Seng is slightly higher, and the Nikkei closed slightly lower and on the currency markets the euro is trading at €1.35 and 67.8 pence.