The Department of Finance says a contraction in the Irish economy was caused by the patent cliff in the pharmaceutical sector.

New figures show that the overall economy shrank slightly last year.

The Central Statistics Office says activity, in GDP terms, fell by 0.3% in 2013.

It compares to growth of just under 1% in 2012.

The Government had projected GDP growth of 0.2% for 2013 on Budget Day last October.

However when multinational companies are excluded, the figures show in GNP terms, the economy grew by 3.4%.

KBC Bank Chief Economist Austin Hughes says the data paints a mixed picture:Economist John Fitzgerald from the Economic and Social Research Institute says the GNP figures shows there is activity in the domestic economy: