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Thursday, September 28, 2023

Intel to build $25 billion factory in Israel, the largest foreign investment in the country

Intel Corp, the U.S. chipmaker, announced on Sunday that it will invest $25 billion to build a new factory in Israel, which will be the largest-ever international investment in the country, according to Prime Minister Benjamin Netanyahu.

The factory, which will be located in Kiryat Gat, is expected to open in 2027 and operate until at least 2035. It will create thousands of jobs and boost Israel’s economy and technology sector.

Intel has been operating in Israel for almost five decades and is the country’s largest private employer and exporter. It has also acquired several Israeli companies, such as Mobileye, which develops advanced driver-assistance systems.

The deal was hailed by Netanyahu as “a tremendous achievement for the Israeli economy” and by Finance Minister Avigdor Lieberman as “a vote of confidence in Israel’s human capital and innovation”.


Under the deal, Intel will pay a 7.5% tax rate, up from the current 5%, which will generate more revenue for the state1.

The investment comes as Intel is trying to regain its dominance in chip making and reduce its dependence on Asian suppliers, amid a global shortage of semiconductors that affects various industries.

Intel’s CEO Pat Gelsinger has unveiled a strategy to expand its manufacturing capacity and become a major producer of chips for other companies. As part of this plan, Intel has also announced plans to build two factories in Arizona for $20 billion and another one in Ohio for up to $100 billion.

Intel’s expansion in the U.S. and Israel is also supported by the Biden administration, which aims to secure more domestic chip production and supply chains. The administration has proposed $52 billion in funding for semiconductor research and development.


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