Semiconductor giant Intel has followed up on an agreement to invest in expanding its production facilities in the southern Israeli town of Kiryat Gat, formally submitting its $5.8million plan for government approval, Haaretz reported on Tuesday.
Officials from Intel arrived on Sunday at the Economy Ministry’s Investment Center offices, to deliver the firm’s request for a government grant. Investment Center Director Nahum Itzkovich said the center would see to expediting the process, since it will bring over 1,000 new jobs to the south.
Intel’s continued participation in the Israeli economy has been eagerly sought. The company exported $3.8 billion of goods and services last year; employs 9,855 people around the country; runs four research and development centers in Haifa, Petach Tikvah, Yerushalayim and at Kibbutz Yakum, near Netanya; has manufacturing facilities in Kiryat Gat and Yerushalayim and purchased some $850 million locally produced goods and services last year alone.
The Intel investment is considered well worth securing. Sources said that initial government feasibility studies show that every dollar invested in the project will generate a return of $3 in the form of income tax revenues, $5 in local purchases by the company and a $12 boost to the gross domestic product, mostly in the form of exports.
The government has informally promised Intel a grant equal to 5% of whatever the company puts into the project, which would amount to a billion shekels. In return, it expects Intel to expand its workforce by 1,200 employees at a salary cost of between 22,000 and 30,000 shekels a month per employee. This is in addition to the 800 employees Intel took on when it bought an adjacent semiconductor-manufacturing facility owned by Micron, another U.S. company, last September.