The Government has approved the introduction of a national postal code.

A Government-commissioned report said the codes would provide long term savings and demographic details for planning. They would also benefit emergency services.

Tenders for the design and implementation of the system will be issued shortly.

The Minister for Communications, Eamon Ryan, said he expected new postal codes with digits and letters to be introduced in 2011.

The Irish Exporters' Organisation has welcomed news of the introduction of postcodes, pointing out that Ireland is the only EU or OECD country without a postal code system.

The association's CEO John Whelan says the Minister should ensure that the tender for the new system calls for the very latest technology to be utilised.

'There is opportunity for Ireland in coming late to the modern post code system to jump ahead of other countries who have for many years being using the post code system,' he added.

He says that the current postal system is inefficient and is believed to be adding 20% to 30% to the sorting and routing costs in An Post.