Intel will invest €1.6 billion in its Irish operation and increase its workforce here by 400 following a decision by the computer chip maker to manufacture its next series of semiconductors in Ireland.
The development, supported by an IDA grant, will lead to the construction of leading edge technology wafer fabrication facilities at its Leixlip site.
In a statement welcoming the move the Tanaiste, Ms Harney, said the investment secures the long-term employment of Intel employees.
Intel employs about 4,700 people directly and on long term contracts at its manufacturing plant in Leixlip and a research centre in Shannon.
"This investment will ensure that Intel Ireland continues to produce the latest microchips using the latest technologies and that it maintains its reputation for successfully transferring these latest technologies from the laboratory into high volume production.
Ireland faced stiff competition from several locations for this investment and the decision by Intel to commence this new phase of investment in its Irish operations confirms Ireland's position as a world class technology location and one of Europe's top locations for semiconductor innovation and manufacturing" the Tanaiste said.
At the end of the first quarter Intel earned $1.7 billion, or 26 cents a share, on revenue of $8.1 billion. In the same period a year earlier, Intel reported a profit of $915 million, or 14 cents a share, on revenue of $6.75 billion.