That figure is £80m more than in 1998, and confirms the growing importance of the industry in the UK, said the European Leisure Software Publishers Association (ELSPA).

If the ELSPA forecast proves correct the UK leisure software market will have more than doubled in size since 1996, when it was worth £350m.

Unlike real rugby, in games like this the UK has many world beaters

One in four computer games sold in Europe is UK made, as is one in eight games sold in the lucrative US market.

"The creativity and product innovation on show from British leisure software developers is quite mind-blowing, and the frantic commercial interest from buyers across the world confirms the value of the industry to the British economy," said Roger Bennett ELSPA's director general.

"British produced games are estimated to have generated a staggering £1.1bn ($1.8bn) in retail sales outside the UK last year, generating a hugely positive balance of trade," he added.

The sector is already worth almost one-and-a-half times the takings of British cinema box offices and 1.8 times those of video cassette rentals.

Greatest investor in Europe

ELSPA's annual report, to be published in full later this year, shows the market is performing ahead of expectations and is outstripping rates of growth in all other mature industry sectors in the UK.

It is expected to get a further boost from the launch of Sega Enterprises's Dreamcast games console in Europe later.

Sales are also being fuelled by the rise of on-line games retailers.

The report said the UK is the greatest European investor in games software development, with an estimated £300m to be invested in 1999, up 23% from £243m in 1998.

There are an estimated 250 development studios employing 5,600 people.

ELSPA's report was published just three days after the largest games company in the UK, Eidos, reported a £20.3m loss in the three months ended June 30, 1999.