JERUSALEM (VINnews) — In a major vote of confidence in Israel’s economy, Intel Israel announced that it will invest a further $15 billion in its new manufacturing facility in Kiryat Gat, over and above the investment of $10 billion announced in 2019, according to a Globes report. The company has thus confirmed the announcement of the investment six months ago by the Israeli government, despite the war situation in Israel which has greatly effected economic developments in the country.
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Intel says that the agreement with the government is for an investment totaling $25 billion for the upgrading and expansion of the Kiryat Gat fab. Under the agreement, the government will award Intel a grant of $3.2 billion over several years, in accordance with certain milestones, presumably targets for employment reciprocal investment in Israeli companies and contractors. Intel has undertaken to buy products and services from Israeli companies to the tune of $60 billion over the next decade. This is the highest grant that the Israeli government has ever awarded a private-sector company. It is estimated to cover 12.8% of the total costs of construction and upgrade of the fab.
The new fab, construction of which has already begun, is expected to start production within four to five years. It will use an ultra-violet lithography production process unique to Intel. Special machines for this purpose have already been ordered from Netherlands company ASML. The new facility will be headed by Meirav Ben-Hamu Kriyef.
Intel opened its first center in Israel in Haifa in 1974, employing five people. Today, it is the largest private-sector employer in the country, with some 12,000 employees. Intel says that the investment in the new fab will bring its aggregate investment in Israel in its 50 years of operating in the country to some $50 billion.
Two weeks ago, Intel Corporation CEO Pat Gelsinger spoke in an interview with Fox Business in the US about the company’s operations in Israel:
“We have 20,000 people I consider myself as responsible for there, between our direct employees, contractors and construction, and about 17% of them are on reserve duty today. We’ve lost several members in the conflict from the family, and some of our members have lost their children, and we still have some hostages.. We’ve supported our teams financially, emotionally… But the Israeli people are the most resilient people on earth. They have not missed a single wafer commitment or product commitment despite the conflict. That’s why we believe so deeply in them.”
Gelsinger added, “We’ve also supported humanitarian efforts across the region as well. We pray for peace to come quickly to the region and for a more permanent solution… but we are deeply committed to our operations there.”