Israel’s Economy Minister Eli Cohen announced that Intel, the global chip-making giant, is planning a $5 billion expansion of its cutting-edge manufacturing facility in Kiryat Gat, The Times of Israel reported Wednesday.
The planned expansion comes on the heels of the company’s $6 million investment to upgrade the facility, that was announced in 2014 and inaugurated two years ago, to produce advanced 10 nanometer chips. In return for that commitment Intel received grants totaling $600 million and tax breaks through the year 2023.
The just-announced plans were presented to Cohen on Wednesday by Intel’s management team. Intel plans to apply for both tax breaks and grants from the government in accordance with the Encouragement of Capital Investments Law. According to the Economics Ministry, a committee will review Intel’s requests for its eligibility for those incentives next month.
It is expected that Intel could receive half a billion dollars in incentives from the Government of Israel for its latest expansion.
Intel’s announced decision to expand its facilities in Israel comes on the heels of policies implemented by President Donald Trump to encourage American companies to expand at home in the United States.
“Intel’s choice to continue to significantly invest in Israel is an important sign of faith in Israel and in its economy,” Cohen said in the statement announced the company’s plans.
With 12,000 employees in Israel, Intel is the largest private employer in the Jewish state. At the end of 2017, Intel paid out bonuses equivalent to two and a half months salary to most of its Israeli employees. The bonuses, the company said, reflected both its success and profitability.
Intel has invested an estimated $17 billion in Israel since it established its presence there in 1974. In addition to 11,000 employees at the Kiryat Gat facility, its research centers in Jerusalem, Petach Tikva and Haifa, Intel also employs 1,000 at Mobileye, which it acquired last year for $15 billion.
According to company records, Intel was responsible for $3.6 billion in exports from Israel in 2017.
[Photo: Intel Israel / YouTube ]