Intel lines up €4bn expansion for its Israel chip plant
Intel has said that it has submitted plans to expand its production operations in Israel, with the Israeli government saying the US chipmaker would invest about $5bn (€4.2bn).
Intel is one of the biggest employers and exporters in Israel, where many of its new technologies are developed. The new investment will upgrade its Kiryat Gat manufacturing plant in southern Israel, the company said in a statement.
Intel did not provide financial details.
Israel's Finance Ministry said the company would invest about 18 billion shekels (€4.3bn) in the factory between 2018-2020 and had agreed to spend 3 billion shekels (€710m) on local suppliers.
"According to company officials, this investment is expected to pave the way for a future significant investment for a technological upgrade at the Israeli site," the ministry said in a statement.
In return, Intel will be granted an extension of its reduced tax rate of 5pc until 2027. The Finance Ministry said it was also considering giving Intel a 700 million shekel (€165m) grant, with a second grant of the same size to come with future investments.
"This is to incentivise the company to carry out the future investment that could be significantly higher than past and current investments," the ministry said.
Intel said it exported €3bn of goods and services from Israel in 2017, about 8pc of the country's total hi-tech exports.
Intel employs around 5,000 people in Ireland.