Cadbury Ireland is cutting 200 jobs at plants in Dublin and Kerry as part of a cost-reduction exercise.

The company, which has been in the Republic for more than 75 years and employs 1,100 workers, blamed the job losses on "a difficult trading environment".

It attempted to mitigate the blow by simultaneously announcing a £17.1m investment for its Dublin plant, which exports more than 75% of what it produces to the UK and US markets.

"The general high cost of manufacturing in Ireland has been compounded by recent currency movements, and this loss of competitiveness has led to a decline in export demand," said the company in a statement.

"It is clear that in the current environment, only cost-effective, flexible and competitive manufacturing operations will survive. We need to reduce our costs consistent with the economic realities.

"The job losses are necessary to safeguard Cadbury's operations in Ireland and protect existing jobs into the future."

Union leaders are currently in talks with the company on redundancy terms and on the possibility of saving some of the jobs facing the axe.

Meanwhile, the lay-offs have led to renewed calls from employer groups for government action to reduce the cost of business in the Republic, particularly relating to wages and the high price of energy and waste disposal.