New figures from the Central Statistics Office show that manufacturing production fell by 2.2% in December compared to November.

The CSO figures reveal that on an annual basis, production in December was 7.5% lower than the same time the previous year.

The modern sector, which is made up of a number of high technology and chemical sectors, saw a monthly decrease of 4.3%. Chemicals and pharmaceuticals recorded an annual drop of 13.9% in December.

Today's figures also show a monthly increase of 0.1% in the traditional sector. This sector was up 0.1% in the year in December, the sixth annual rise in the past seven months after disappointing first half of 2013. 

Merrion economist Alan McQuaid said that he still firmly believes that when the world economy regains momentum, Ireland is better placed than most to take advantage of that. 

"As regards 2014, we are optimistic that all things being equal, manufacturing output will post a modest single digit increase on 2013," the economist added.