$25 billion dollar investment is to create thousands of new jobs in city of Kiryat Gat. ‘An investment like this is an expression of confidence in the Israeli economy and its high-quality manpower.’
By Ben Rappaport, United with Israel
US semiconductor chip manufacturer Intel will establish a new factory in the southern Israeli city of Kiryat Gat with an investment of $25 billion dollars, Reuters reported on Sunday.
The factory is to open in 2027 and will operate at least through 2035, Reuters added, citing Israel’s finance ministry.
The ministry also said that Intel will pay a 7.5% tax rate under the deal, up from the current 5%.
In return, according to Calcalist, Intel will receive a grant, in accordance with the Law to Encourage Capital Investments, amounting to 12.8% of the investment amount, subject to meeting targets.
The ministry said that as a result of the investment, thousands of additional workers are expected to be hired in Kiryat Gat, at wages higher than the average in the industry, Calcalist reported.
In a statement at the weekly cabinet meeting, Finance Minister Bezalel Smotrich called the plan the “biggest investment ever of an international company in the State of Israel.”
“An investment like this is an expression of confidence in the Israeli economy and its high-quality manpower, the excellent human capital among us,” Smotrich said.
“The benefit to the Israeli market from this investment is huge, and will find expression in growth in the flourishing of the market, in significant growth in the state’s income, and in significant macroeconomic benefits, including employment of workers at a high wage in the southern region, a sharing of knowledge from the great expertise in the giant Intel corporation with various companies in Israel and their training to the highest standards in the world,” he added.
In a statement cited by Reuters, Intel credited Israel with playing a “crucial role” in the company’s global success.
“Our intention to expand manufacturing capacity in Israel is driven by our commitment to meeting future manufacturing needs … and we appreciate the continued support of the Israeli government,” the company said.