Dell has ruled out siting its second European manufacturing plant in Ireland, but its founder and chairman, Mr Michael Dell, remains confident that the company's operation in Limerick will continue to expand.

Speaking in Davos, Switzerland, where he is attending the annual meeting of the World Economic Forum, Mr Dell told The Irish Times the company had yet to decide on the site of the new plant but confirmed that it would not be in Ireland.

"It's really an issue of having capacity to serve the eastern part of Europe, so 'No' is the simple answer," he said.

Mr Dell said the new plant was likely to be in one of the EU's new member-states, but that Limerick, where the company employs more than 3,000 people, would remain at the centre of Dell's European operation.

"Fortunately, our European business is growing well, and of course Limerick is the heart of that operation in terms of our manufacturing and supply chain. They've been growing apace with the European business."

Business executives in Davos have been discussing the next wave of outsourcing and off-shoring, raising fears of an accelerated flight of manufacturing and other activities to Asia.

Mr Dell said, however, that conditions in Ireland continued to be attractive.

"When we first looked at this in 1990 we liked Ireland because of the skilled workforce, a great pro-business environment and good infrastructure and education - and all of those things are still true today. So it worked out very well."

Dell has recently announced the opening of a new plant in North Carolina, the company's largest in the world, but Mr Dell said that changes to US tax laws on repatriation of profits would have no impact on the firm's European operations.

He said he could not praise Dell's Irish workforce too highly.

"We don't try to hide from the reality of what it means to stay competitive so we are very explicit with our teams in explaining - here are the things we have to do to stay competitive. This is what our customers are telling us. This is what the competition is creating.

"So everyone knows what we have to do to stay competitive, and I'm proud to say that's a team that's up to the challenge. It's a really good team."