The trade surplus narrowed in December as the value of imports rose 12 per cent during the month.

The seasonally adjusted figures showed exports remained relatively unchanged at €7.64 billion, but imports rose month on month to €3.9 billion. This cut the trade surplus by 10 per cent to €3.7 billion.

On an unadjusted basis, the value of exports in the month rose 21 per cent compared to a year earlier, and imports were 8.8 per cent higher. The unadjusted trade surplus was up €930 million to €3.2 billion for December, and reached a new record of €44.7 billion for the year.

Minister for Enterprise, Trade and Innovation, Mary Hanafin welcomed the figures, saying they built on the export success achieved throughout the year.

"This achievement by our exporters is to be commended particularly given the extremely difficult and competitive trading circumstances in which they operate," she said.

Between January and November of 2010, exports showed a year on year rise of 6 per cent, or €4.5 billion, to €82.8 billion.

This was driven partly by the pharmaceutical industry, which exported goods worth €2.85 billion more than in the comparable period, a rise of 14 per cent. Exports of organic chemicals rose by 8 per cent or €1.3 billion.

However, this increase was partially offset by a decrease in the export of computer equipment of €1.8 billion, or 31 per cent.

"Back in 2001/2002 Irish exports were dominated by the production of office machinery, which accounted for over €20 billion in exports," National Irish Bank's chief economist Dr Ronnie O'Toole wrote in a note. This was impacted by the closure of Dell's Irish manufacturing facility, and in the first 11 months 2010, it accounted for only €4 billion.

Exports of transport equipment were down by 69 per cent or €479 million.

Imports, meanwhile, were down 0.2 per cent over the period, to €41.3 billion. Imports of transport equipment were 35 per cent lower, while computer imports declined by 29 per cent or €983 million.

Imports of petroleum products were up 28 per cent, while vehicle imports rose by 76 per cent.

Irish exports were mainly to the US, Belgium, Britain and Germany, which accounted for 60 per cent of the total value of exports for the first 11 months of 2010. Ireland's main import markets were Britain, the US, Germany and China.

Bloxham chief economist Alan McQuaid said the trade figures were "very positive", although growth was slightly lower in the final quarter of the year.

"Looking at the monthly trade figures, merchandise export growth moderated somewhat in the final quarter of 2010 reflecting adverse weather conditions, which are likely to have disrupted transportation, together with weakened external demand, as signalled by the loss of momentum in the global measures of world trade volumes," he said.

"Still, the overall surplus of almost €45 billion for the whole of last year was very impressive all things considered. The bottom line is that the export sector offers the one ray of light at the moment in a fairly gloomy economic picture, and will be the key driver of the Irish recovery story in the short-term. We think 2011 will be another very good year for Irish exports, with the merchandise trade surplus forecast to rise to close on €50 billion."

Ibec said the export-led recovery remained on track.

"The medical and pharmaceutical sectors continue to make a major contribution to Ireland's export-led recovery, as do food exports, which are now supported by strong commodity prices and a more favourable exchange rate with the UK," said the business group's head of trade and transport policy Pat Ivory

He called on the incoming government to act quickly to address competitiveness issues for businesses, including reducing key business input costs and making indigenous entrepreneurship and support for small businesses a priority.