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Intel plans another chip plant in Israel - Sharon

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CIOL Bureau
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JERUSALEM: Intel Corporation is planning to set up another chip plant in Israel with an investment of about $4 billion.

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According to the reports, Israeli Prime Minister Ariel Sharon told cabinet ministers on Sunday that he had been informed by Intel Corp.'s head, that Intel plans to build another plant in Israel. "I spoke yesterday with the head of Intel, Craig Barrett, who informed me the company had decided to build another plant in Kiryat Gat (in southern Israel) in an investment of about $4 billion," Sharon was quoted as telling the cabinet meeting in a statement issued by his office.

A spokesman for Intel in Israel declined to comment. The Prime Minister's Office, together with the Industry and Trade Ministry and the Finance Ministry, have put together a framework for government aid to Intel to set up the plant, the Industry and Trade Ministry said in a separate statement.

The ministry said its Investment Center would give a grant of 15 percent of the investment up to $3.5 billion, for a total of $525 million.

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Finance Minister Benjamin Netanyahu said in a statement that the government in 2001 had originally agreed to give a grant to Intel of 12.5 percent of the investment but recently Intel had asked the state to raise its grant to 20 percent.

The compromise of 15 percent is worth an additional $90 million. The grant is subject to a professional survey, Netanyahu said.

The plant, which several countries around the world have been lobbying for, will employ 2,000 workers in Kiryat Gat -- home to another factory that makes Pentium processors and other Intel chips. Intel employs nearly 6,000 in a number of chip manufacturing plants and development centers in Israel. The company has been operating in Israel for 30 years.

"I see in this decision a declaration of complete faith in Israel's economic policy and stability," Sharon said. Intel will submit to the Investment Center by the end of July a plan for its investment, the ministry said.

The center will then review Intel's request with an aim of completing the examination process as quickly as possible. It will seek to issue a letter of approval by December 31 and the investment will be carried out over a period of no more than 5 years.

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