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Intel to invest $25 billion in Israel factory in record deal

Intel to invest $25 billion in Israel factory in record deal

Intel Corp (INTC.O) plans to invest $25 billion in a new chip factory in Israel, its biggest ever investment in the country, Prime Minister Benjamin Netanyahu said on Monday.

The U.S. chipmaker will build the plant in Kiryat Gat, a town in southern Israel where it already has a production facility. The new factory will produce advanced 7-nanometer chips that are faster and more energy-efficient than current ones.

“This is a huge vote of confidence in Israel’s economy and technology,” Netanyahu said at a news conference with Intel CEO Pat Gelsinger. “This is the largest investment ever made by a foreign company in Israel.”

Gelsinger said Intel chose Israel for its skilled workforce, strong innovation ecosystem and supportive government policies. He said the new plant will create thousands of jobs and help Intel meet the surging global demand for chips.

“Israel is a key part of Intel’s global strategy and operations,” Gelsinger said. “We are proud to continue our long-term partnership with this country and invest in its future.”

Intel is also investing $10 billion to expand its existing plant in Kiryat Gat, which makes 10-nanometer chips. The company said it expects to start production at the expanded facility in 2025.

Intel is one of Israel’s largest employers and exporters, with over 14,000 workers and $8 billion in exports in 2020. The company has received billions of dollars in tax breaks and grants from the Israeli government over the years.

Israel is a global hub for high-tech industries, especially in the fields of cybersecurity, artificial intelligence and biotechnology. The country attracted a record $30 billion in foreign direct investment in 2020, despite the COVID-19 pandemic.

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